Forex Brokers Award 2020
Vote your favourite broker
Trade 100 Bonus - the best offer on Forex market

EUR / USD retains the probability of a corrective upward move

Jan 23 2019, 02:28 PM (+06) |

On Wednesday in  European morning session, EUR/USD is trading in positive territory, showing some signs of a corrective move that we have been waiting for four days amid oversold markets and strong technical levels. At the same time, trading volumes and the activity of this market remain low as the entire FOREX market volitility is below average.

Yesterday, the trading session was somewhat mixed. In the morning, sellers dominated the market. Before the beginning of the American session, the currency pair tested the level of 1.1340, having updated 3 January low. ZEW Institute data in Germany provided additional pressure for European currency as the economic statistic proved to be somewhat weak.

According to the data presented, the economic sentiment index was -15 points, with the expected figures was -18.4 points, i.e. the data came out somewhat better than expected, but the indicator still remains deep in the negative territory. The index of current economic conditions unexpectedly dropped from 45.3 points to 27.6 in a month, setting a minimum of February 2015.

This data confirmed previously published data from the IMF and recent Germany data on the deteriorating economic situation in the leading EU economies, which will inevitably affect the economic activity in Europe.

Tuesday data on US existing home sales came out below expectations which somewhat supported EUR/USD pair. The fact was 4.99M, the forecast is 5.25M. It should be noted here that the demand for the American currency remains limited for several reasons. First, investors are increasingly worried about the US government "shatdown." The problems associated with this continue to grow, but there are no options so far to end the crisis. Another strong negative factor for USD dollar remains Fed policy, under which the regulator intends to take a pause in the process of raising interest rates. Next week, FOMC meeting will take place, the results of which may determine the further mid-term trend of the dollar movement.

Today, the market situation is unlikely to change seriously, since there is no important news in the economic calendar of Europe and the USA. But we want to emphasis that market  uncertainty remains very high.

Technical picture of the market

The currency pair fell to the lower region of the wide horizontal range 1.1275-1.1780, as further movement below is very problematic. Now we see some attempts to expand the market upwards, which can lead to the formation of a rolling movement. But, given the current volatility in the market, there should be no big moves. Most likely, the price movement potential will be limited to the range 1.1425-1.1450.

Fort Financial Services - a licensed international Forex broker. A wide range of trading opportunities: more than 500 tradable contracts, Fort, Flex, Pro and Newbie accounts, direct access to world exchanges, diverse trading platforms: MetaTrader4, CQG Trader, Ninja Trader, Binary Options, partnership programs, free analytics and much more.