(News Bulletin 247) – Two antagonistic forces were at work at the heart of the week on the Euro / Dollar currency pair: on the one hand the tone of the “Minutes” of the Fed, a little less “aggressive” than anticipated without upsetting the monetary matrix, and on the other hand the difficulty of regaining appetite for risk in the ultra-tense geopolitical context between NATO and Moscow, the first requiring the second formal proof of a massive withdrawal Russian troops on the Ukrainian border, thereby refusing to speak of de-escalation. Result: strong pressure on both components of the currency pair.
Currency traders turned to US consumption on Wednesday, sacrosanct consumption which is the main driver of national wealth creation across the Atlantic. The subject is all the more sensitive as the latest publications from the University of Michigan on the morale of the American consumer have shown a real weakness in this regard. The score of 61.7 for this month, in preliminary data, is a low point since November 2011. It is for this reason that operators are eager to know the “real” consumption figures. However, retail sales for the month of January jumped 3.8% month-on-month, well above expectations…
Moreover, the federal report on industry in January largely beat expectations, both for the production dynamic itself (+1.4%) and the production capacity utilization rate (77.6% ).
To follow in priority, on the agenda this Thursday, the weekly registrations for unemployment benefits and the Philly Fed manufacturing index at 2:30 p.m.
At midday on the foreign exchange market, the Euro was trading against $1.1380 about.
KEY GRAPHIC ELEMENTS
For the first time since June 16 (then on sudden break), the spot was close to its 100-day moving average (in orange), the underlying trend line still very significantly bearish. My very broad consolidation took shape below $1.1460 which is a chart resistance level. The field is immediately open towards the lower limit of this very wide range, around $1.1115. Currency traders will however avoid taking an immediate position in the absence of a satisfactory entry point.
MEDIUM TERM FORECAST
In view of the key graphic factors that we have mentioned, our opinion is neutral in the medium term on the Euro Dollar (EURUSD).
We will keep this neutral opinion as long as the Euro Dollar (EURUSD) parity prices are positioned between the support at 1.1260 USD and the resistance at 1.1460 USD.
CHART IN DAILY DATA
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