EUR/USD: the pressure dollar before the plots dowry

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The degradation of the note of the French debt at the end of the past week will have absolutely not put pressure on the euro. It is therefore not the question of French public debt which comes to animate the debates on the pair of currencies, although “France brings a little spice to European tranquility”, but “it is indeed across the Atlantic that the essentials are played out”, decides Thomas GIUDICI, head of the bond management of Auris Gestion, while the FED completes this Wednesday a monetary policy committee (FOMC).

“Two risks remain nevertheless. The first – which encourages us to maintain a prudent posture – would be a more marked weakening than anticipated by the job market, forcing the Fed to lower its rates either by comfort but by necessity, in order to counter a real economic degradation. The second, in contrast, would be a resurgence of inflation supplied by an overwhelming monetary. Resilient, which would force the Fed to turn back earlier than expected. “

All eyes are indeed pointing on the outcome of this FOMC, which will mark a new phase in the monetary softening process. The Fed will naturally be questioned about its reflection in the face of the brutal loss of speed of employment, in a context of just as brutal decrease in immigration.

“The markets largely anticipate a monetary relaxation of the federal reserve this evening, after data on employment signaling a significant slowdown in the United States. In addition to price stability, full employment constitutes a central mandate of the Fed, which suggests several rate reductions by the end of the year. The pace and the magnitude of the adjustments will however depend on the next macroeconomic data (inflation, GDP) “, Summates Grégoire Kounowski, Investment Advisor at Norman K.

Bover can take note of the projections of the Fed in the form of a point diagram (the famous plots dowry). The mechanics are simple: the 12 voting members, under the cover of anonymity, register their feeling as to the level of the Fed Funds for the next deadlines.

On the statistical front, very good news across the Atlantic on retail sales (+0.7% monthly out of automobiles), much above the consensus. A reassuring figure after the publication at the end of last week of the consumer confidence index (U-Mich, preliminary data).

Note that the ZEW index of investor confidence in Germany has increased sharply, 37.3 largely beating the target, defined by market consensus. “Financial market experts demonstrate cautious optimism and the ZEW indicator has stabilized, but the economic situation has deteriorated. Considerable risks remain, persistent uncertainty about American customs policy and” autumn reforms “in Germany,” comments the president of ZEW, Dr. Achim Wambach.

At midday on the foreign exchange market, the euro was treated against $ 1,1840 approximately.

Key graphics elements

The slaughtered oblique in black decks, defining the quality of the bottom bullish trend. Following a new support on this benchmark, the Bollinger bands are initiating a slight spacing, we resume our upcoming work on the pair of currencies, which has sufficiently consolidated.

Medium term

In view of the key graphic factors that we have mentioned, our opinion is positive in the medium term on Euro dollar parity (Eurusd).

Our entry point is 1,1842 USD. The course of course in our Haussier scenario is 1,2464 USD. To preserve the committed capital, we advise you to position a protection stop at 1,1694 USD.

The profitability hope of this Forex strategy is 622 pips and the risk of loss is 148 pips.

Daily data graphics