Euro Analysis 12.10.2021

The single currency, the euro, fluctuated in a narrow range tilted to the upside during the Asian session, to witness its rebound for the second session in five sessions from its lowest since July 22, 2020 against the US dollar on the cusp of developments and economic data expected today, Tuesday, by the economies of the euro area and the American economy, the largest economy In the world, which includes the speech of members of the Federal Open Market Committee.

At exactly 06:58 am GMT, the euro pair rose against the US dollar by 0.10% to 1.1561 levels, compared to the opening levels at 1.1549, after the pair achieved its highest level during the session’s trading at 1.1564, while it achieved its lowest at 1.1547.

The markets are looking forward to Germany, the largest economy in the eurozone, to reveal a reading of wholesale inventories prices, which may show an acceleration of growth to 0.7% compared to 0.5% in August, before we also witness from Germany the release of a statistical reading of the ZEW confidence index, which may reflect the expansion of deflation To 23.7 compared to 26.5 in September, the same indicator reading for the economies of the euro area as a whole may also indicate the expansion of deflation to 27.9 compared to 31.1.

On the other hand, investors are currently waiting for the US economy to release a statistical reading of job opportunities and job turnover, which may reflect an increase to about 10.95 million compared to 10.93 million in July, and this comes in the wake of labor market data at the end of last week showing a decline in unemployment rates to 4.8% compared to 5.2% in August, outperforming expectations that indicated a decline to 5.1%.

In the same context, the reading of the employment change index for sectors other than agricultural also showed, on Friday, about 194 thousand jobs added, compared to 366 thousand jobs added, which were modified from about 235 thousand jobs in August, worse than expectations that indicated about 490 thousand jobs added, while The average hourly earnings index reading reflected an acceleration of 0.6% growth compared to the previous August reading and expectations of 0.4%.

Markets are also looking forward to Federal Open Market Committee (FOMC) Deputy Governor Richard Clarida speaking on the economic outlook and monetary policy at an online event hosted by the Institute of International Finance, before witnessing Federal Open Market Committee (FOMC) member and Federal Reserve Bank of Atlanta President Rafael Bostik speak on Inflation at an online event hosted by the Peterson Institute for International Economics.

Technical Analysis

The euro against the dollar is conducting a test to support the bearish flag mentioned yesterday, waiting to break this support to activate the negative effect of this pattern and then push towards our first awaited target at 1.1500, reminding you that breaking this level will extend the bearish wave to reach 1.1420 as a next station.

Therefore, we will continue to suggest the bearish trend for the upcoming period, provided that the price maintains its stability below the 1.1595 level.

The expected trading range for today is between 1.1480 support and 1.1600 resistance

The forecast general trend for today: Bearish