Forex Market: EUR/USD daily trading forecast

Yesterday’s trade saw EUR/USD within the range of 1.1332-1.1418. The pair closed at 1.1398, losing 0.12% on a daily basis.

At 8:11 GMT today EUR/USD was up 0.17% for the day to trade at 1.1416. The pair touched a daily high at 1.1427 at 8:24 GMT.

Fundamentals

ECB policy meeting minutes

At 12:30 GMT for the first time the European Central Bank is to publish the minutes from its most recent meeting on policy, held on January 22nd. The minutes offer a fair and balanced reflection of policy deliberations, while providing the rationale behind the central bank’s monetary policy decision.

“Now that people know what they say is for the record, there might be some who are more careful on how they state their position, but others will also want to make their case more forcefully,” said Thomas Harjes, senior European economist at Barclays Plc in Frankfurt cited by Bloomberg. “More transparency is always welcome.”

“With the publication of accounts, people will have their dissent on the record,” said Marco Valli, an expert at UniCredit SpA in Milan, cited by the same media. “Disagreement is natural when you have 25 people sitting around a table trying to find a sensible monetary policy response to the current macro picture.”

Eurozone Consumer Confidence – preliminary estimate

Confidence among consumers in the Euro area probably improved for a third consecutive month in February. The preliminary value of the consumer confidence index probably rose to -7.55 from a final value of -8.5 in January. If so, this would be the highest level of confidence since June 2014, when the indicator was reported at a final value of -7.5. The index measures consumer confidence on a scale of -100 to +100. A reading of -100 suggests a lack of confidence, zero means neutrality and a reading of +100 indicates extreme levels of confidence. The index reflects the level of optimism, which consumers have about economic development in the region. The Business and Consumer Survey is conducted by phone and includes 23 000 households in the Euro area. The questions asked stress on current economic and financial situation, savings intention and also on expected developments regarding consumer price indexes, general economic situation and major purchases of durable goods. This indicator is one of the five major components, that comprise the Economic Sentiment Indicator (ESI).

Higher confidence usually implies greater willingness to spend, including large-ticket purchases, while consumer spending is a key factor behind economic growth. Therefore, in case the consumer confidence index improved more than anticipated, this would cause a bullish impact on the euro. The European Commission is expected to release the preliminary reading at 15:00 GMT.

United States

Initial, Continuing Jobless Claims

The number of people in the United States, who filed for unemployment assistance for the first time during the week ended on February 13th, probably decreased to 295 000 from 304 000 in the prior week. The latter has been the highest level since the week ended on January 16th. The 4-week moving average, an indicator lacking seasonal effects, was 289 750, marking a decrease of 3 250 from the previous weeks revised up average of 293 000.

Initial jobless claims number is a short-term indicator, reflecting lay-offs in the country. In case the number of claims fell more than projected, this would have a bullish effect on the greenback.

The number of continuing jobless claims probably rose to the seasonally adjusted 2 375 000 during the week ended on February 6th, from 2 354 000 in the previous week. This figure has been the lowest since the week ended on December 19th 2014, when 2 351 000 claims were reported. The figure also represented a decrease by 51 000 compared to the revised up number of claims, reported during the week ended on January 23rd. This indicator represents the actual number of people unemployed and currently receiving unemployment benefits, who filed for unemployment assistance at least two weeks ago.

The Department of Labor is to release the weekly report at 13:30 GMT.

Philadelphia Fed Manufacturing Index

The Philadelphia Fed Manufacturing Index probably increased to a reading of 9.3 in February from 6.3 index points during the previous month. The index is based on a monthly business survey (the Business Outlook Survey), measuring manufacturing activity in the third district of the Federal Reserve, Philadelphia. Participants give their opinion about the direction of business changes in overall economy and different indicators of activity in their companies, such as employment, working hours, new and existing orders, deliveries, inventories, delivery time, price etc. The survey is conducted every month since May 1968. The results are presented as the difference between the percentages of positive and negative projections. A level above zero is indicative of improving conditions, while a level below zero is indicative of worsening conditions. The Federal Reserve Bank of Philadelphia is expected to release the official results from the survey at 15:00 GMT. Higher-than-expected index readings would have a bullish effect on the greenback.

Pivot Points

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.1383. In case EUR/USD manages to breach the first resistance level at 1.1433, it will probably continue up to test 1.1469. In case the second key resistance is broken, the pair will probably attempt to advance to 1.1519.

If EUR/USD manages to breach the first key support at 1.1347, it will probably continue to slide and test 1.1297. With this second key support broken, the movement to the downside will probably continue to 1.1261.

The mid-Pivot levels for today are as follows: M1 – 1.1279, M2 – 1.1322, M3 – 1.1365, M4 – 1.1408, M5 – 1.1451, M6 – 1.1494.

In weekly terms, the central pivot point is at 1.1366. The three key resistance levels are as follows: R1 – 1.1462, R2 – 1.1540, R3 – 1.1636. The three key support levels are: S1 – 1.1288, S2 – 1.1192, S3 – 1.1114.