EUR Analysis 16.10.2019

The single currency of the European Union fluctuated in a narrow range tilted to decline during the Asian session to witness the rebound for the second session in four sessions from the highest since September 20 last against the US dollar on the eve of developments and economic data expected on Wednesday by the euro zone economies and the US economy The largest economy in the world.

At 05:18 am GMT, EUR / USD fell 0.01% to 1.1032 levels from the opening at 1.1033, after the pair reached a session low of 1.1024, while the pair reached its highest at 1.1036.

Markets in the Euro-Zone economy as a whole are looking for the release of the final annual CPI reading which could reflect a stable growth of 0.9%, little changed from the initial reading for September and 0.7% in the prior reading of August. Also, the core annual reading of the index itself may also show a stable growth of 1.0%, little changed from the previous initial reading of 0.9%.

This comes in conjunction with the release of the seasonally adjusted reading of the Trade Balance Index for the euro area as a whole, which may show that the surplus shrank to 18.6 billion euros from 19.0 billion euros last July, and up to the speech of the Bundesbank Governor Jane Weidmann in New York. , The markets are also looking forward to the developments of the negotiations on the Brexit file amid hopes of an agreement.

On the other hand, investors are awaiting the US economy to reveal the retail sales reading, which accounts for about half of consumer spending, which accounts for more than two-thirds of US GDP, which may reflect a slower pace of growth to 0.3% from 0.4% last August. The core reading of the index itself may show 0.2% growth versus the August zero level.

This comes before we see the FOMC and Chicago Fed Governor Charles Evans talk about the current economic conditions and monetary policy at the Greater Peoria Development Board in Illinois, and before the release of the US housing market data with the housing index read by the National Association of Builders. Houses which may reflect stability at 68 during October.

Markets are also looking to the Wholesale Inventories figure, which may show a slowdown in growth to 0.3% from 0.4% in July, before we see the release of the Beige Book report, which is important two weeks before the FOMC meeting. One of the cornerstones on which the Fed's monetary policy makers build their decisions is to support and stimulate the US economy.

The upcoming FOMC meeting is scheduled to be held in Washington on October 29-30. Investors are also looking ahead to FOMC and Fed Governor Lyle Brainard's speech later today. Digital currency and policy implications at the event hosted by the Peterson Institute for International Economics in Washington.

Technical Analysis

EUR / USD is back to fluctuate around the 1.1030 level after yesterday's decline, moving above the bullish intraday trend line shown, while SMA 50 continues to provide positive support for the price.

Therefore, our bullish outlook will remain intact for the coming period, targeting mainly 1.1180, taking into consideration that the breach of 1.0980 will stop the expected rally and press the price to return to the bearish main path again.

Expected trading range for today is between 1.0950 support and 1.1120 resistance.

Expected trend for today: Bullish.