Even though the Conference Board’s consumer confidence survey came in at lower than expected level the US stock markets rallied yesterday. This bullish sentiment helped the S&P 500 to move to our first target zone. We reported yesterday how BlackRock the world’s largest asset management firm said it favours US blue-chips and small-cap stocks. This, together with strong manufacturing data created a risk hungry environment in which it made sense to look for upside targets. Once again the market moved to our high probability target quite quickly and provided an excellent trading opportunity for our traders. Today’s risk events include Financial Stability Review from the ECB, preliminary GDP numbers and unemployment claims from the US. The highlight of the day is the release of the FOMC Meeting Minutes which traders hope will insights on the future Fed policy. See our economic calendar for times and details.  By reading further you agree with our disclaimer at the bottom of this page and acknowledge that we do not provide investment advice.

EURUSD is trading near the high of the recent range. The pair rallied above the 1.1906 resistance but wasn’t able to hold the levels and dropped lower. This is an indication of short-term weakness and if it continues could lead to intraday short trade opportunities in EUR pairs. The key support and resistance levels in EURUSD are 1.1799, 1.1833, 1.1906 and 1.1920. The proximity of the 1.1920 resistance could mean that intraday rallies today turn out to be short-lived. Having said this, we still always trade what you see taking place in the markets, not some preconceived ideas on what must happen. For more analysis on this and many other markets, you may want to subscribe to TIOmarkets YouTube channel.

EURAUD is trading just below the high of the bearish channel the pair has lately been in. This price level (1.6230) coincides with 50% Fibonacci retracement level and 50-period SMA. We look for sell signals below the 50-period moving average (1.6230) with our target one zone at 1.6160 – 1.6185. The key support and resistance levels in EURAUD are 1.6121, 1.6140 and 1.6268. If the pair breaks out of the channel the alternative scenario is that EURAUD will challenge the 1.6288 high. Should that happen we will re-evaluate the price action in this pair. The short trade idea is valid only if EURAUD price now rolls over and doesn’t violate the resistance created by the channel high and the 50-period SMA.

Recent macroeconomic data releases

  • Canadian Core Retail Sales 1%, 0.0% expected
  • Canadian Retail Sales 1.1%, 0.2% expected
  • French Flash Services PMI, 38, 39.2 expected
  • French Flash Manufacturing PMI 49.1, 50.2 expected
  • German Flash Manufacturing PMI 57.9, 56.0 expected
  • German Flash Services PMI 46.2, 46.1 expected
  • UK Flash Manufacturing PMI 55.2, 50.5 expected
  • UK Flash Services PMI 45.8, 43.2 expected
  • US Flash Manufacturing PMI 56.7, 52.5 expected
  • US CB Consumer Confidence 97.7 expected

Macroeconomic data releases today

  • ECB Financial Stability Review
  • US Prelim GDP 33.1% expected
  • US Unemployment Claims 732K expected
  • US Revised UoM Consumer Sentiment 76.9 expected
  • FOMC Meeting Minutes

You may access the times and dates in the economic calendar here.

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Trade Safe!

Janne Muta
Chief Market Analyst
TIOmarkets.com

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