EUR analysis 10.12.2019

The euro currency fluctuated in a narrow range slanting upward during the Asian session to witness its bounce to the sixth session in eight sessions from the lowest since October 10 against the US dollar on the cusp of developments and economic data expected today by the euro area economies and the American economy the largest economy In the world, which includes launching the activities of the Fed meeting in Washington.

At 05:07 am GMT, the euro pair rose against the US dollar by 0.03% to 1.1064 levels compared to the opening levels at 1.1064, after the pair achieved its highest level during the trading session at 1.1071, while achieving the lowest at 1.1063.

The market is currently looking to France, the second largest economy in the euro area, for the release of the industrial production reading, which may reflect the stability of growth at 0.3%, little changed from what it was in the previous reading last September, before we witness the disclosure of the same index reading for Italy The region's third largest economy, which may explain the decline, declined to 0.2% from 0.4% in September.

This comes before we witness the disclosure of a statistical reading of the ZEW economic confidence index for Germany, the largest economies of the euro area and the eurozone economies as a whole, which may reflect a widening in Germany and the region as a whole by 1.1 and 2.2 against a contraction of 2.1 and 1.0, respectively, in November / November, otherwise, the markets will look to the European Central Bank meeting tomorrow, Thursday.

It is expected that the monetary policy makers of the European Central Bank will decide next Thursday to stay on interest rates at their current zero levels, with the fixing of the marginal lending rate at 0.25%, in addition to maintaining a negative interest rate on deposits -0.40% and proceeding with the quantitative easing program at 20 billion Euro per month as long as necessary, before we witness the press conference of the European Central Governorate Christine Lagarde.

On the other hand, investors are currently awaiting by the American economy the disclosure of the final reading of the productivity index and the cost of one work, and it is expected that the productivity index reading will show a 0.3% decline compared to a 0.1% decline in the initial reading for the third quarter and a growth of 2.3% in the previous reading of the second quarter last , While the cost index reading may show a slowdown in growth to 3.4% compared to 3.6% in the first reading and 2.6% in the second quarter.

Other than that, the markets are looking forward to the launching of the FOMC meeting, which takes place today and tomorrow, Wednesday in Washington, through which the short-term reference interest rates for the second consecutive meeting are expected to remain between 1.75% and 2.00% in conjunction with the disclosure of Committee members' expectations for growth, inflation and unemployment rates, as well as the future of interest rates for the next three years.

Up to the press conference to be held by Federal Reserve Governor Jerome Powell tomorrow, exactly half an hour after the FOMC meeting ends to comment on the decisions of the Federal Reserve monetary policy makers, which has been witnessing widespread criticism recently by US President Donald Trump who is calling on the Federal Reserve and his Powell Governor to go Move ahead to cut federal funds interest "to zero or less."

Technical analysis

The euro against the dollar pair begins trading today with a new bullish tendency to move above 1.1065, to show attempts to achieve immediate gains before trying to resume the bearish trend again.

Until now, the downside scenario remains effective unless 1.1108 level is breached and stability above it, as breaching this level will push the price to achieve more gains that reach 1.1180 as a next station, while the main targets of the suggested downside wave are located at 1.0995 then 1.0950.

The expected trading range for today is between 1.0970 support and 1.1120 resistance.

Expected trend for today: bearish.