- German GDP YoY: ACT – 1.3%; EST – 1.2%
- German GDP QoQ: ACT – 0.4%; EST – 0.3%
- No pivot indicators from ECB minutes whereas ECB officers again increased charges for now.
Recommended by Warren Venketas
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EURO FUNDAMENTAL BACKDROP
The euro discovered some bids on Friday morning after higher than anticipated German GDP (see financial calendar beneath) each YoY and QoQ respectively. Unfortunately, shopper confidence missed forecasts however did enhance from the November learn. In conjunction with the above financial knowledge, ECB officers reiterated that inflation is seemingly entrenched long-term whereas the ECB’s Muller erred on the hawkish facet (including to Isabel Schnabel’s feedback) and I quote “too dangerous to attend for a downturn to chill costs” suggesting that extra interest rate hike are wanted to quell inflationary pressures. Throughout the day we’ve additional ECB audio system which may spark additional upside ought to they appear to help the present market sentiment.
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EUR/USD ECONOMIC CALENDAR
Source: DailyFX economic calendar
Recessionary fears are nonetheless very actual for the eurozone however wanting on the monetary policy minutes yesterday, there was nothing alongside the strains of moderating the tempo of price hikes as we’ve seen within the U.S..
EUR/USD DAILY CHART
Chart ready by Warren Venketas, IG
EUR/USD price action remains to be testing the important thing space of confluence across the 200-day SMA (blue) and whereas there’s nonetheless room for a push increased in the direction of the psychological 1.0500 deal with, the basic differential between the U.S. and eurozone stays skewed to the USD. Today’s candle shut may give short-term directional steering come subsequent week. A detailed beneath the 1.0369 swing low may spark a draw back transfer in the direction of subsequent help zones.
IG CLIENT SENTIMENT DATA: BEARISH
IGCS exhibits retail merchants are at present SHORT on EUR/USD, with 56% of merchants at present holding brief positions (as of this writing). At DailyFX we sometimes take a contrarian view to crowd sentiment however resulting from current adjustments in lengthy and brief positioning, we favor a short-term draw back bias.
Contact and observeWarrenon Twitter:@WVenketas