The EUR/USD hesitates after the recent rise in volatility
After having greatly benefited from the Fed meeting on Thursday evening, with a rally of over 100 pips up to the top of a 1,1514 Thursday morning, the pair EUR/USD weakening yesterday, for the final undo almost all of the gains made in the face of the Fed.
Several european statistics, in fact, have penalized the single currency, with, in particular, sales in the German retail sharp decline for the month of December, and that unemployment is decreasing less marked than expected.
The preliminary GDP in the Q4 of the euro area, although in line with expectations, and came him also to put in light the economic downturn in the euro area, with growth estimated at 1.2%, against 1.16% of the previous quarter.
But what most weighed on the Euro were comments made by Jens Weidmann, president of the German BundesBank and a member of the ECB, delivered a speech resolutely dovish tone saying that it was not necessary to expect a rebound in growth before 2020-2021.
It was also felt that it should not unnecessarily waste the time to think about the normalization of the monetary policy (rate hike), with an economy that has deteriorated and inflation is still at a good distance of the objectives of the ECB.
These remarks dovish have been particularly influential on the Euro, on the one hand because Weidmann is traditionally more a part of the camp, “hawkish” to the ECB, and secondly because he is often tipped to take over from Mario Draghi head of the ECB in the month of October.
In the Face of this highly disadvantageous for the single currency, the EUR/USD pair has spent most of the day yesterday to fix.
Technical update EUR/USD
From a technical point of view, the moving average 100 hours currently has 1,1442 has clearly played a role in the support, and protects it for the moment, the Euro a stronger decline.
Below this level, the next support potential to take into account are to 1.14, 1,1350 and 1,1290-1,13.
The increase, 1,1450 is immediate resistance, before 1,1470-75, and then 1,1500-1,1515. Beyond that, the traders could aim for the summit in early January to 1,1570, and then the psychological threshold of 1.16.
An economic calendar is very loaded waiting for EUR/USD on this Friday
Finally, it should be noted that after a day in the economic calendar already loaded in the past, this Friday will also be the opportunity of a number of important statistics, in Europe and in the United States.
For the euro area, we will monitor, in fact, the PMI manufacturing indices Germany and the Euro Zone, at 9: 55 and 10 a.m., before the CPI preliminary in the month of January at 11am.
US side, the most important event will be the report to the NFP on job creation, US in the month of January, prior to the manufacturing PMI at 15: 45, and especially the manufacturing ISM to 16h.
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