EUR Analysis 25.10.2019

The single currency of the European Union fluctuated in a narrow range tilted to decline during the Asian session to witness the bounce for the fourth session in five sessions from the highest since August 14 against the US dollar on the eve of developments and economic data expected on Friday by the largest economies of the euro zone Germany The US economy is the largest in the world.

At 05:14 am GMT, EUR / USD fell 0.02% to 1.1102 levels from the opening at 1.1104, after the pair reached a session low of 1.1101, while the pair reached its highest at 1.1108.

Markets are looking ahead to Germany's GFK consumer confidence statistic which may reflect a contraction in expansion to 9.8 vs. 9.9 in October, and before the largest euro-zone economy is also witnessing the release of the IFO Business Climate reading. Expansion may also show a contraction to 94.5 vs. 94.6 last September, while the reading of the same indicator for expectations may show an expansion to 91.0 vs. 90.8, and the reading of the same indicator for current assessments may reflect a contraction to 98.0 vs. 98.5.

This comes hours after the European Central Bank (ECB) meeting on Thursday, during which the European Central Bank (ECB) monetary policy makers decided to keep interest rates at their current zero levels, stabilize the marginal lending rate at 0.25% and keep the deposit rate negative -0.40%. The QE program will be reactivated by 20 billion euros a month by November and the program will continue as long as necessary.

Also on Thursday, ECB Governor Mario Draghi said at a press conference, his last press conference before former IMF President Christine Lagarde took over as ECB governor by early next month, as negative interest supports growth in the region's economies. The euro, however, has its own risks to be watched by the European Central Bank, while addressing the fact that risks to the eurozone's economy remain as a result of the US-China trade war as well as geopolitical tensions.

Otherwise, markets are currently awaiting the European Union's decision on the British government's request last Saturday to extend the UK's exit from the EU for another three months, until the end of January, and the new European Commission President Ursula von der Leyne said yesterday that the idea The exit extension looks guaranteed, but no decision has yet been made on the appropriate extension period.

In the same vein, French President Emmanuel Macron demanded that the extension of Britain's exit from the European Union to a maximum until November 15, saying that he wants to increase pressure on the British Parliament to support the exit agreement reached by British Prime Minister Boris Johnson this week He added that he feared that prolonging the exit timeframe could lead to a possible exit scenario without agreement.

On the other hand, Prime Minister Johnson also expressed yesterday that he would allow the British Parliament to have sufficient time to discuss the UK exit agreement and the timetable for the exit, if the approval of a general election on 12 December, adding that EU leaders are expected to approve the extension beyond October 31.

In the event that the EU decides to extend the deadline for Brexit for a short period of two weeks or a month, until mid-November or the end of next month, British Prime Minister Johnson may work to pass his exit agreement with Brussels again through parliament. In the case of a three-month extension, Johnson is expected to call parliament to vote on early general elections.

On the other hand, investors are currently awaiting the US economy to reveal the final reading of the University of Michigan Consumer Confidence, which may show the stability of the expansion at 96.0, little change from the initial reading for the month of October and against 93.2 in September, and that comes before we see The US Treasury Department unveiled a reading of the federal budget which may show a surplus of $ 83.5 billion compared to a deficit of $ 200.3 billion last August.

Technical Analysis

The EURUSD traded markedly negative yesterday evening to press the 1.1105 level and move below it, which signals the direction of the price to start a bearish correction in the intraday basis, but we note that SMA 50 is trying to provide positive support for the price, while stochastic is entering the saturation areas. In the sale.

Therefore, we believe that opportunities are available for positive trading in the coming sessions, with the first target at 1.1180, noting that the continuation of the negative pressure and breaking the level of 1.1065 will stop the expected bullish trend and push the price for further bearish correction over intraday basis.

Expected trading range for today is between 1.1030 support and 1.1200 resistance

Expected trend for today: Bullish