Forex Market: EUR/USD daily trading forecast

Yesterday’s trade saw EUR/USD within the range between 1.2517 and 1.2441, the lowest since August 22nd, 2012. The pair closed at 1.2483, losing 0.15% on a daily basis.

At 7:19 GMT today EUR/USD was up 0.18% for the day to trade at 1.2506. The pair held in a daily range of 1.2481-1.2531.

Fundamental view

Europe

Eurostat is expected to report at 10:00 GMT that producer prices within the Euro region slid by an annualized 1.5% in September, compared to a 1.4% decline in August. Month-on-month, the Producer Price Index is expected to have remained unchanged in September, following a 0.1% deflation in the preceding month.

Producer inflation measures average changes in prices received by domestic producers for their output. Its a leading price of consumer price inflation.

United States

The Commerce Departments Bureau of Economic Analysis is expected to report at 13:30 GMT that the US trade deficit probably narrowed slightly to $40.00 billion in September from $40.10 billion in August. If confirmed, this would be the lowest reading since January.

The trade balance measures the difference in value between a country’s exported and imported goods and services during the reported period. It reflects the net export of goods and services, or one of the components to form the country’s Gross Domestic Product. Generally, exports reflect economic growth, while imports indicate domestic demand. A widening trade surplus implies higher demand for the local currency. In case the trade balance deficit widened more than anticipated, this would mount selling pressure on the US dollar.

Later in the day, the US Census Bureau will report on the nations factory orders for September. This indicator measures the change in the total value of new purchase orders placed with manufacturers.

Orders are projected to have declined by 0.6% in September on a monthly basis, compared to a 10.1% contraction in August.

Excluding the sector of transportation, orders probably have risen by 0.1%.

In case new orders dropped more than anticipated, this would have a bearish effect on the greenback, and vice versa.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.2480. In case EUR/USD manages to breach the first resistance level at 1.2520, it will probably continue up to test 1.2556. In case the second key resistance is broken, the pair will probably attempt to advance to 1.2596.

If EUR/USD manages to breach the first key support at 1.2444, it will probably continue to slide and test 1.2404. With this second key support broken, the movement to the downside will probably continue to 1.2368.

The mid-Pivot levels for today are as follows: M1 – 1.2386, M2 – 1.2424, M3 – 1.2462, M4 – 1.2500, M5 – 1.2538, M6 – 1.2576.

In weekly terms, the central pivot point is at 1.2594. The three key resistance levels are as follows: R1 – 1.2703, R2 – 1.2882, R3 – 1.2991. The three key support levels are: S1 – 1.2415, S2 – 1.2306, S3 – 1.2127.