- 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 larger charges for now.
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EURO FUNDAMENTAL BACKDROP
The euro discovered some bids on Friday morning after higher than anticipated German GDP (see financial calendar under) each YoY and QoQ respectively. Unfortunately, shopper confidence missed forecasts however did enhance from the November learn. In conjunction with the above financial information, 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 risky to wait for a downturn to cool prices” suggesting that extra rate of interest hike are wanted to quell inflationary pressures. Throughout the day we’ve additional ECB audio system which might spark additional upside ought to they give the impression of being to assist the present market sentiment.
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EUR/USD ECONOMIC CALENDAR
Source: DailyFX financial calendar
Recessionary fears are nonetheless very actual for the eurozone however trying on the financial coverage minutes yesterday, there was nothing alongside the traces of moderating the tempo of charge hikes as we’ve seen within the U.S..
EUR/USD DAILY CHART
Chart ready by Warren Venketas, IG
EUR/USD worth motion 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 larger in 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 might give short-term directional steerage come subsequent week. An in depth under the 1.0369 swing low might spark a draw back transfer in direction of subsequent assist zones.
IG CLIENT SENTIMENT DATA: BEARISH
IGCS reveals 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 usually take a contrarian view to crowd sentiment however as a consequence of current adjustments in lengthy and brief positioning, we favor a short-term draw back bias.
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