Yesterday’s trade saw EUR/USD within the range of 1.1163-1.1338. The pair closed at 1.1288, surging 0.88% on a daily basis. It has been the 15th gain in the past 27 trading days, a second consecutive one and also the sharpest one since February 4th. The daily high has been the highest level since October 22nd, when a high of 1.1352 was registered.
At 7:13 GMT today EUR/USD was edging up 0.13% for the day to trade at 1.1203. The pair touched a daily high at 1.1238 at 3:25 GMT, overshooting the range resistance level (R3), and a daily low at 1.1185 during the early phase of the Asian trading session.
On Wednesday EUR/USD trading may be influenced by the following macroeconomic reports and other events as listed below.
Fundamentals
Euro area
Italy – industrial output
Annualized industrial production in Italy probably expanded 1.4% in December, according to the median forecast by experts. If expectations were met, December would be the sixth consecutive month of expansion. In November industrial output grew 0.9%, or at the slowest rate since April 2015, when it rose 0.1%. At the same time, the seasonally adjusted index of industrial production probably grew 0.3% in December compared to November, following a 0.5% slump in the preceding month. The latter has been the sharpest monthly decline since August 2015. The index reflects the change in overall inflation-adjusted value of output in sectors such as manufacturing, mining and utilities. In case annual output increased at a faster rate than anticipated, this would have a limited bullish effect on the common currency, as it would suggest a greater possibility of inflationary pressure build-up. The National Institute of Statistics (Istat) is to release the official industrial data at 9:00 GMT.
United States
Fed Chair Janet Yellens testimony
At 15:00 GMT Federal Reserve Chair, Janet Yellen, is expected to testify before the US Congress. After the testimony a Questions and Answers session will be held, which may trigger high volatility in US stock markets as well as in the Foreign Exchange Market.
Daily and Weekly Pivot Levels
By employing the Camarilla calculation method, the daily pivot levels for EUR/USD are presented as follows:
R1 – 1.1304
R2 – 1.1320
R3 (range resistance) – 1.1336
R4 (range breakout) – 1.1384
S1 – 1.1272
S2 – 1.1256
S3 (range support) – 1.1240
S4 (range breakout) – 1.1192
By using the traditional method of calculation, the weekly pivot levels for EUR/USD are presented as follows:
Central Pivot Point – 1.1072
R1 – 1.1333
R2 – 1.1506
R3 – 1.1767
S1 – 1.0899
S2 – 1.0638
S3 – 1.0465
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