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Forex Market: EUR/USD daily trading outlook

Yesterday’s trade saw EUR/USD within the range of 1.0902-1.1146. The pair closed at 1.1093, surging 1.59% on a daily basis. It has been the 12th gain in the past 23 trading days, a third consecutive one and also the sharpest one since December 3rd 2015. The daily high has been the highest level since October 22nd, when a high of 1.1352 was registered.

At 7:22 GMT today EUR/USD was losing 0.18% for the day to trade at 1.1073. The pair touched a daily low at 1.1070 at 7:15 GMT, overshooting the daily S1 level, and a daily high at 1.1117 during the early phase of the Asian trading session.

On Thursday EUR/USD trading may be influenced by the following macroeconomic reports as listed below.


Euro area

ECB Economic Bulletin

At 9:00 GMT the European Central Bank will release its new publication, which replaced the Monthly Bulletin. The Economic Bulletin includes a detailed analysis of current and future economic conditions and price stability risks in the Euro region from the bank’s perspective. It is published two weeks after the ECB’s monetary policy decision.

United States

Initial, Continuing Jobless Claims

The number of people in the United States, who filed for unemployment assistance for the first time during the business week ended on January 29th, probably rose to 280 000, according to market expectations, from 278 000 reported in the preceding week. The latter has been the lowest number of claims since the week ended on January 1st 2016, when 277 000 claims were reported.

The 4-week moving average, an indicator lacking seasonal effects, was 283 000, marking a decrease by 2 250 compared to the preceding weeks revised up average.

The business week, which ended on January 22nd has been the 46th consecutive week, when jobless claims stood below the 300 000 threshold, which implied a healthy labor market.

Initial jobless claims number is a short-term indicator, reflecting lay-offs in the country. In case the number of claims met expectations or increased further, this would have a moderate bearish effect on the US dollar.

The number of continuing jobless claims probably fell to the seasonally adjusted 2 240 000 during the business week ended on January 22nd from 2 268 000 in the preceding week. The latter represented an increase by 49 000 compared to the revised up number of claims reported in the week ended on January 8th. This indicator reflects the actual number of people unemployed and currently receiving unemployment benefits, who filed for unemployment assistance at least two weeks ago.

The Department of Labor is to release the weekly report at 13:30 GMT.

Factory Orders

Factory orders in the United States probably shrank 2.8% in December compared to November, according to the median estimate by experts, following another 0.2% drop in the preceding month. If expectations were met, this would be the sharpest monthly rate of decline since December 2014, when a 3.5% contraction was reported. Excluding the sector of transportation, factory orders went down 0.3% in November from a month ago. This indicator reflects the total value of new purchase orders, placed at manufacturers for durable and non-durable goods, and can provide insight into inflation and growth in the US sector of manufacturing. In case the general index of new orders dropped at a faster-than-anticipated rate, this would have a moderate bearish effect on the US dollar, as it implies future growth slowdown. The US Census Bureau will release the official data at 15:00 GMT.

Daily and Weekly Pivot Levels

By employing the Camarilla calculation method, the daily pivot levels for EUR/USD are presented as follows:

R1 – 1.1115
R2 – 1.1138
R3 (range resistance) – 1.1160
R4 (range breakout) – 1.1227

S1 – 1.1071
S2 – 1.1048
S3 (range support) – 1.1026
S4 (range breakout) – 1.0959

By using the traditional method of calculation, the weekly pivot levels for EUR/USD are presented as follows:

Central Pivot Point – 1.0864
R1 – 1.0943
R2 – 1.1048
R3 – 1.1127

S1 – 1.0759
S2 – 1.0680
S3 – 1.0575

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