We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bullish
Gold
Mixed
Oil - US Crude
Bullish
Bitcoin
Bearish
More View more
Real Time News
  • Heads Up:🇯🇵 JPY All Industry Activity Index (MoM) (DEC) due at 04:30 GMT (15min), Actual: N/A Expected: 0.3% Previous: 0.9% https://www.dailyfx.com/economic-calendar#2020-02-21
  • Feb 28: - Fed speak - US🇺🇸 income/spending data, consumer sentiment - India🇮🇳 + Canada🇨🇦 GDP - Consumer confidence: New Zealand🇳🇿 + UK🇬🇧 - CPI: Germany🇩🇪, France🇫🇷, Italy🇮🇹 + Eurozone🇪🇺 - South Korea🇰🇷 industrial production Click here ⬇️to learn more https://www.dailyfx.com/webinars/146770987
  • Feb 27: - Bank of Korea🇰🇷 rate decision - French🇫🇷 President Macron meets with Italian🇮🇹 Prime Minister Guiseppe Conte - Norway🇳🇴 sov wealth fund publishes annual report - US GDP🇺🇸, durable goods data - Economic confidence data in Italy, Eurozone🇪🇺 - Vietnam🇻🇳 trade + CPI
  • Feb 26: - EIA crude oil 🛢️inventory report - South African🇿🇦 Finance Minister presents 2020-21 budget which will likely impact their sovereign credit rating - Hong Kong🇭🇰 GDP - US new home sales🏠learn why housing is important here: https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/euro_open/2019/12/30/Why-Markets-Will-be-Closely-Watching-Housing-Data-in-2020.html
  • Feb 24: - Trump meets with Modi - German🇩🇪 IFO business confidence - New Zealand🇳🇿 retail sales - China🇨🇳 may announce decision to delay annual meeting National People's Congress Feb 25: - World Bank President speech - GDP: Germany🇩🇪, Mexico🇲🇽 - US🇺🇸 Consumer Confidence
  • Hello there, traders! We may have a potentially volatile week ahead of us against the backdrop of panic from the #coronavirus🦠: Feb 22: - #G20SaudiArabia (Main topic will be global impact of virus) - Results from #IranElections2020 (hardliners expected to make a big splash)
  • The #Euro may bounce after hitting the lowest level in close to three years against the US Dollar. While the broader trend points firmly lower, selling pressure may be ebbing. Get your market update from @IlyaSpivak here: https://t.co/697SQ9AGxw https://t.co/BLxeiLzcLR
  • Commodities Update: As of 03:00, these are your best and worst performers based on the London trading schedule: Silver: 0.45% Gold: 0.27% Oil - US Crude: -0.57% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/3CldFB8zgt
  • RT @YuanTalks: #China's passenger #car sales slumped 92% y/y in the first half of February due to the #coronavirus outbreak, said the Passe…
  • My trading video for today: 'Dollar's Run Earns $EURUSD, $USDJPY and $AUDUSD Breaks; Nasdaq Fronts Risk Retreat' https://www.dailyfx.com/forex/video/daily_news_report/2020/02/21/Dollars-Run-Earns-EURUSD-USDJPY-and-AUDUSD-Breaks-Nasdaq-Fronts-Risk-Retreat.html?ref-author=Kicklighter&QPID=917719&CHID=9 https://t.co/nUMqyxrVag
Euro Short Taken At 1.3602 With Intraday Studies Looking Stretched

Euro Short Taken At 1.3602 With Intraday Studies Looking Stretched

2011-10-10 11:35:00
Joel Kruger, Technical Strategist
Share:
  • Short EUR/USD at 1.3602; stop-loss 1.3710
  • Merkel-Sarkozy proposed plan well received this far by markets
  • Solid US employment data also factoring into better start to week
  • Italian and Spanish downgrades brushed aside and forgotten
  • Belgium and Luxembourg agree on recue plan for Dexia
  • UK Cameron out offering his take on the eurozone crisis
  • Bank of England Weale leaves door open for additional QE expansion

Risk sentiment has been given a bit of a boost into the early week, with currencies, equities and commodities all tracking decently higher into European trade. Markets had initially been weighed down on Friday following the news of Fitch downgrades to Italy and Spain, but were able to shrug off the downbeat development after taking more time to fully digest solid US employment data. Also seen helping to accelerate rallies in risk correlated assets was the weekend story that Germany’s Merkel and France’s Sarkozy had promised the delivery of a comprehensive plan by the end of the month to rid the eurozone of its debt crisis.

Relative performance versus the USD on Monday (as of 11:00GMT)

  1. CHF +1.87%
  2. AUD +1.70%
  3. EUR +1.56%
  4. NZD +1.29%
  5. CAD +0.98%
  6. GBP +0.58%
  7. JPY -0.03%

Merkel and Sarkozy said their goal was to come up with a sustainable answer to Greece’s woes, look to find a way to recapitalize European banks, and plan for a deepening economic coordination between the eurozone’s members by the November G20 summit. Elsewhere, Belgium and Luxembourg have agreed on a rescue plan for Dexia, but any potentially positive price action resulting from this headline has been offset by Moody’s, with the rating agency placing Belgium’s ratings on review for a possible downgrade.

Still, we continue to warn against buying into these risk rallies, as the overall state of the markets remains highly fragile and much work needs to be done before any sustainable economic recovery can be achieved. UK’s Cameron was out recently echoing these sentiments after saying that European leaders needed to adopt a “big bazooka” approach to resolving the crisis. Cameron added that time was short and that the eurozone was contributing more to the overall uncertainty in the global economy than any other region. Cameron went on to suggest the need for a substantial increase in the firepower of the EFSF, while at the same time urging an improvement in the banking sector and governance of the eurozone.

Some would however recommend that Cameron spend more time focused on his own economy with UK fundamentals also showing signs of additional stress. The normally more hawkish BOE Weale was out commenting that there is still more room for additional quantitative easing expansion after citing a sharp deterioration in the UK’s prospects.

At this point, technical studies still classify the risk rallies as corrective, and the overall trend remains risk negative. The Euro is in the process of correcting out from the recent lows by 1.3145, and while the markets holds below 1.3690, a fresh lower top is sought ahead of the next downside extension below 1.3145. Market participants should take their cues from this market and only back above 1.3690 would compromise the current structure. Looking ahead, all is quiet in North America, with the US calendar empty for Columbus Day. US equity futures and commodities markets are well bid.

TRADE OF THE DAY

Morning_Slices_body_eur.png, Euro Short Taken At 1.3602 With Intraday Studies Looking Stretched

EUR/USD: Setbacks have stalled out for now by 1.3145 with the market in search of a fresh lower top below 1.3690 ahead of the next major downside extension below 1.3000. Overall, our outlook remains quite bearish and we continue to project deeper setbacks into the lower 1.2000’s over the coming weeks. Ultimately, only back above 1.3690 would delay outlook and give reason for pause. As such, we have opted to employ our ATR analysis and with the market having well exceeded its daily average true range of 180 points ahead of the North American open, we like the idea of fading the strength intraday. Additionally, the price has shot through the 20-Day SMA to leave the hourly RSI well overbought and in need of some relief. Look to hold the position into the New York close (5pm NY Time) on Monday and then reassess. POSITION: SHORT @1.3602 FOR AN OPEN OBJECTIVE; STOP-LOSS 1.3710.

--- Written by Joel Kruger, Technical Currency Strategist

To contact Joel Kruger, email jskruger@dailyfx.com. Follow me on Twitter @JoelKruger

To be added to Joel Kruger’s distribution list, send an email with subject line “Distribution List” to jskruger@dailyfx.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.