EUR analysis 17.01.2020

The single currency fluctuated the euro in a narrow range slanting back down during the Asian session to witness its bounce for the second consecutive session from its highest since January 7 against the US dollar on the cusp of developments and economic data expected on Friday by the economies of the euro area and the American economy, which includes Recent members of the Federal Open Market Committee.

At 05:23 am GMT, the euro against the US dollar fell 0.02% to 1.1135 levels compared to the opening levels at 1.1137, after the pair achieved its lowest level during the trading session at 1.1131, while achieving the highest at 1.1143.

The markets are looking forward to the release of the treasury budget reading for France, the second largest economy in the eurozone, before we witness the disclosure of the seasonally adjusted reading of the current account index for the eurozone economies as a whole, which may reflect the widening of the surplus to 34.3 billion euros against 32.4 billion euros in October, simultaneously. With the release of the trade balance for Italy, the third largest economy in the region, which may explain the shrinking surplus to 7.22 billion euros, compared to 8.06 billion euros.

Up to the disclosure of inflation data for the eurozone economies as a whole with the release of the annual final reading of the consumer price index, which may reflect the stability of growth at 1.3%, little changed from the initial reading for the month of December and 1.0% in the previous reading for the month of November, as well The substantial annual reading of the same indicator may also show stability in growth of 1.3%, little changed from the previous preliminary reading and the previous reading of November.

Otherwise, we followed yesterday the European Central Bank Governor Christine Lagarde expressed the fact that the European Central attaches importance to citizens by focusing on issues other than price stability and the goal of inflation within the next review of it, indicating that it will be open and transparent during the coming period and will listen to the concerns of citizens, She added that monetary policy makers should agree on the first policy review since 2003 at the next meeting.

Lajad also touched on the importance of uniting, confronting the growing populist movements and addressing the issue of Britain's exit from the European Union and the growing trade protectionism, explaining that uniting Europe gives it preference in discussions with other countries and defending the common interests of Europe, in another context, as the European Commission President Ursula Vaud Dair stated Line also yesterday that the European Parliament will ratify the Brexit agreement by the end of this month.

On the other hand, investors are currently awaiting the release of housing market data by the US economy, with the release of each of the start-up homes and the building permit, and amid expectations that building permits will decline by 3.8% to about 1,405 thousand permits, compared to a 5.0% increase at 1,461 thousand permits in November. November, while start-up homes may reflect an increase of 2.0% to 1,340,000 homes compared to a rise of 3.8% at 1,314,000 homes.

This comes before we witness the speech of a member of the Federal Open Market Committee and Chairman of the Federal Reserve Bank of Philadelphia Patrick Harker about the economic expectations at the Economic Leadership Forum for New Jersey bankers, before the disclosure of industrial sector data for the largest industrial country in the world with the release of the industrial production index, which may reflect stability It is at zero levels, against a 0.1% rise in November.

In the same vein, the reading of the energy utilization index may show a decrease to 77.0% compared to 77.3% in November, leading to the disclosure of the preliminary reading of the University of Michigan index of consumer confidence for January, which may show stability of expansion at a value of 99.3 below Little change from what it was in the previous reading of December.

This comes in conjunction with the release of the employment opportunities and job turnover reading, which may reflect a decrease to 7.24 million compared to 7.27 million last October, before we witnessed another member of the Federal Committee, Deputy Governor of the Federal Reserve, Randall Quarles, about banking supervision. At the annual meeting of the Banking Law Commission of the American Bar Association in Washington.

Technical analysis

The euro against the dollar trades bounced lower after approaching the 1.1180 level yesterday, to keep the bearish trend valid for the next period, pending a visit to the 1.1065 level, which represents the support of the bullish channel that appears in the picture.

It should be noted that breaching the mentioned support will extend the descending wave to target 1.0980 as the next negative station, while breaching 1.1180 represents the key to restore the main bullish direction again.

The expected trading range for today is between 1.1060 support and 1.1200 resistance.

Expected trend for today: bearish.