Forex Market: EUR/USD daily forecast

During yesterday’s trading session EUR/USD traded within the range of 1.3522-1.3557 and closed at 1.3536.

At 8:20 GMT today EUR/USD was losing 0.07% for the day to trade at 1.3522. The pair touched a daily low at 1.3520 at 8:19 GMT, breaching the first key support.

Fundamental view

Euro zone

Industrial production in the Euro zone probably jumped 0.5% in April from the previous month, according to the median analyst’ estimate. In March, industrial output dropped 0.3%. On year-over-year basis, the index probably rose 0.9% in April, following an unexpected 0.1% decline in the previous month.

Industrial production is an indicator of the business cycle that shows the activity and development in the industry as a whole, by measuring the change in volume for a certain period of time. Information on industrial production is raised through special studies for EU members, which are called Prodcom. They cover between 5000 and 6000 products. The index measures the percentage change from the previous month.

A larger than expected increase in the industrial output would heighten the appeal of the euro. The official report is due out at 09:00 GMT.

United States

The initial jobless claims in the US probably fell to 309 000 in the week ended June 7th, from 312 000 a week ago, according to the median estimate by experts.

The statistical arm of the US Department of Labor will release an official report at 12:30 GMT today. If jobless claims fall more than expected, this will provide support for the US dollar.

In addition, Retail Sales in the US probably jumped 0.6% in May from a month ago, when they rose 0.1%.

The indicator includes the total volume of wholesale and retail sales (cash or credit) of companies, mainly specializing in the retail sector. Sales are measured net, after deduction of the costs of refinancing. They do not include taxes paid by the buyer directly to the local government or the federal budget. These calculations measure the value of the operations used mostly by stores, whose main activity is retail sales. The index excludes retail sales made ​​by manufacturers, wholesalers, and other core businesses who operate in sectors, other than the retail sector. This is the percentage change in the index from the previous month.

At the same time, retail sales, excluding sales of autos or core retail sales probably rose 0.4% last month, after remaining flat in April. Sales of autos, which comprise about 20% of total retail sales are excluded from the index, because their high volatility distorts the overall trend. Therefore, data without auto sales is considered a better indicator of the changing market trend. This is the percentage change in the index from the previous month.

Higher-than-expected readings would have a bullish effect on the greenback. The US Census Bureau will release an official report at 12:30 GMT.

Technical view

According to Binary Tribune’s daily analysis, in case EUR/USD manages to breach the first resistance level at 1.3555, it will probably continue up to test 1.3573. In case the second key resistance is broken, the pair will probably attempt to advance to 1.3590.

If EUR/USD manages to breach the first key support at 1.3521, it will probably continue to slide and test 1.3503. With this second key support broken, the movement to the downside will probably continue to 1.3485.