Home/Central banks/EUR/FX/News events/Newsfeed/Technical analysis/TradingView/USD

Euro jumps to 10-day high

Share Print 0

The euro has posted strong gains on Monday. EUR/USD is trading at 1.1126 in the North American session at the time of writing, up 0.49% today. The euro is at its highest level since Sept. 6.

It’s a quiet day on the data calendar, with no tier-1 events. In the US, the Empire State Manufacturing index rebounded to 11.5 in September, much higher than the August reading of -4.7 and the market estimate of -3.9. This was a shocker as the manufacturer index had contracted nine straight times before today’s reading.

Tuesday will be busier, with German ZEW economic sentiment index and US retail sales. German ZEW economic sentiment plunged to 19.2 in August, down from 41.8 in July. The market estimate for September stands at 17.1. US retail sales are expected to fall to 2.2% y/y in August, down from 2.7% in July.

Fed faces a tough choice – 25 or 50?

This week’s key event is the Federal Reserve meeting on Wednesday, with a 25 basis-point cut practically guaranteed. Will the Fed opt for an oversize 50-bps cut or play it safe with a 25-bps move? The rate cut odds continue to swing wildly. After last week’s producer price index reading, the odds of a 50-bps point cut soared to 41%, up from just 13% before the release, according to the CME’s FedWatch tool. That has increased to 59% today.

The uncertainty over what the Fed will do could last right up to the wire. The Fed is in a quandary as it needs to balance the risk of inflation moving higher against the recent weakness in the labor market. A modest 25-bps cut may not be sufficient to improve the employment picture, while a 50 bps cut might send a message that the Fed believes the economy is in deep trouble.

EUR/USD Technical

  • EUR/USD is testing resistance at 1.118. Above, there is resistance at 1.1160
  • There is support at 1.1060 and 1.1018

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.

Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental and macroeconomic analysis, Kenny Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in major online financial publications including Investing.com, Seeking Alpha and FXStreet. Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

Latest posts by Kenny Fisher (see all)

, , , ,
Back to Top