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Forex Market: EUR/USD daily forecast

During yesterday’s trading session EUR/USD traded within the range of 1.3342-1.3415 and closed at 1.3366, gaining 0.01% for the day.

At 6:26 GMT today EUR/USD was losing 0.08% for the day to trade at 1.3353. The pair touched a daily low at 1.3349 at 6:00 GMT, breaching the first key weekly support level.

Fundamental view

Euro zone

The annualized final consumer price index in the Euro zone, evaluated in accordance with Eurostat’s harmonized methodology, probably remained unchanged at 0.4% in July, matching the preliminary estimate reported on July 31st, that was the weakest since October 2009. In June the annualized final HICP stood at 0.5%, as reported on July 17th. The index shows the change in price levels of a basket of goods and services from consumer’s perspective and also reflects purchasing trends. The HICP is used to evaluate and compare inflation rates between Member States, according to Art . 121 of the Amsterdam’s Agreement and directives by the European Central Bank (ECB), in order to achieve price stability and the implementation of monetary policy. In case the HICP increased more than anticipated, thus, approaching the 2% inflation objective set by the ECB, this would support demand for the euro, because of the greater possibility of an interest rate hike. Eurostat is scheduled to release the official data at 9:00 GMT.

In addition, Euro zone’s preliminary annualized Gross Domestic Product probably expanded 0.7% during the second quarter of 2014, compared to a year ago. The quarterly GDP in the region probably inched up 0.1% in Q2, after a 0.2% increase in the first quarter of 2014. In case region’s economy expands more than expected, the single currency would receive support. Eurostat is to publish the official report at 9:00 GMT.

United States

Initial jobless claims in the US probably rose to 307 000 in the week ended August 9th, from 289 000 a week ago, according to the median estimate by experts.

The indicator measures the number of applications for unemployment benefits that are recorded each week in a report prepared by the Bureau of Labor Statistics in the United States. Initial application or (Initial Claim) means a completed document from an unemployed person before the local government, which is considered a claim for compensation or the possibility of compensation. The completion of the initial claim marks the beginning of a period in which the applicant receives unemployment benefits. The survey covers the number of applications registered in the previous week and is an important indicator concerning the health of the US labor market.

The statistical arm of the US Department of Labor will release an official report at 12:30 GMT today. If jobless claims rose less than expected, this will provide support for the US dollar.

Technical view

Screenshot from 2014-08-14 09:31:55

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.3374. In case EUR/USD manages to breach the first resistance level at 1.3407, it will probably continue up to test 1.3447. In case the second key resistance is broken, the pair will probably attempt to advance to 1.3480.

If EUR/USD manages to breach the first key support at 1.3334, it will probably continue to slide and test 1.3301. With this second key support broken, the movement to the downside will probably continue to 1.3261.

In weekly terms, the central pivot point is at 1.3414. The three key resistance levels are as follows: R1 – 1.3460, R2 – 1.3492, R3 – 1.3538. The three key support levels are: S1 – 1.3382, S2 – 1.3336, S3 – 1.3304.

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