Forex Market: EUR/USD daily forecast

During yesterday’s trading session EUR/USD traded within the range of 1.3679-1.3714 and closed at 1.3703.

At 6:22 GMT today EUR/USD was adding 0.04% for the day to trade at 1.3706. The pair touched a daily high at 1.3709 at 5:20 GMT.

Fundamental view

Euro zone

The surplus on Euro zone’s seasonally adjusted current account probably widened to 24.2 billion EUR in March, according to the median estimate of experts. In February the surplus figure was 21.9 billion EUR. The official data is to be released at 8:00 GMT.

In addition, the preliminary value of the compound index of economic sentiment (ESI) for the Euro zone probably improved to a reading of -8.0 during the current month from -8.6 in April. The European Commission is expected to publish the preliminary data at 14:00 GMT. This survey precedes the final reading by two weeks. A larger than projected improvement in the index would provide support to the single currency.

United States

At 18:00 GMT the Federal Open Market Committee (FOMC) will release the minutes from its meeting on policy held on April 29-30th. The minutes offer detailed insights on FOMC’s monetary policy stance. The release is closely examined by traders, as it may provide clues over interest rate decisions in the future. High volatility is usually present after the publication.

At 15:00 GMT Fed Chair Janet Yellen is expected to make a statement. She took the place of Ben Bernanke as chairman of the U.S. Federal Reserve in February 2014 with a 4-year term. In her public events, Yellen has so far maintained moderate tone and the stance that for the recovery of the U.S. Economy, monetary policy of low interest rates and financial incentives is needed. Statements by FOMC members attract investors’ attention, as they may offer clues over the possible direction of monetary policy in the future. Yellen’s remarks may indicate a positive or negative trend in a short term.

Technical view

According to Binary Tribune’s daily analysis, in case EUR/USD manages to breach the first resistance level at 1.3718, it will probably continue up to test 1.3734. In case the second key resistance is broken, the pair will probably attempt to advance to 1.3753.

If EUR/USD manages to breach the first key support at 1.3683, it will probably continue to slide and test 1.3664. With this second key support broken, the movement to the downside will probably continue to 1.3648.