EUR/USD – Lack of Events Leaves Euro Unchanged

The euro has started the week with little movement. In the Monday session, EUR/USD is trading at 1.1934, up 0.01% on the day. On the release front, there are no eurozone events. In the US, the sole indicator is New Home Sales, which is expected to slow to 627 thousand. On Tuesday, the US releases CB Consumer Confidence, with an estimate of 123.9 points. We’ll also hear from Fed Chair Designate Jerome Powell and Treasury Secretary Steven Mnuchin.

German indicators continue to point upwards, and the week ended on a positive note, as German Ifo Business Climate in November set another record high. The indicator climbed to 117.5, above the estimate of 116.6 points. On Thursday, Final GDP in the third quarter accelerated to 0.8%, its strongest quarter since 2014. Manufacturing PMI surged to 62.5, pointing to strong expansion in the manufacturing sector. On the political front, there are renewed hopes that another election can be avoided, as the SPD (socialist democrats) have reluctantly agreed to hold coalition talks with Merkel’s conservative bloc. The SPD was the junior partner in the previous government, and is expected to come with a shopping list if it agrees to a “grand” coalition. This could mean more government spending and no cap on asylum seekers. The euro has not lost a stride since the political crisis erupted, and on Friday, the currency pushed above 1.19 for the first time since late September.

Federal Reserve policymakers remain upbeat about the U.S economy, according to the minutes of the most recent policy meeting. The minutes indicated that policymakers expected the U.S economy to continue showing strong growth, and predicted that interest rates will be raised in the “near term”. The members discussed the vexing question of why inflation has been persistently low (no quick-fix solution was provided), with most agreeing that a tight labor market should lead to higher inflation levels. Although policymakers did not provide further hints about the timetable of a rate hike, the markets remain convinced that additional rates are imminent. The odds of a rate hike in December are 93%, and the odds of a January raise are at 91%.

EUR/USD Fundamentals

Monday (November 27)

• 10:00 US New Home Sales. Estimate 627K
• 17:30 US FOMC Member Neel Kashkari Speaks
• 19:00 US FOMC Member William Dudley Speaks

Tuesday (November 28)

• 10:00 US CB Consumer Confidence. Estimate 123.9
• 10:00 Fed Chair Designate Jerome Powell Speaks
• 15:45 US Treasury Secretary Steven Mnuchin Speaks

*All release times are GMT

*Key events are in bold

EUR/USD for Monday, November 27, 2017

EUR/USD for November 27 at 6:50 EDT

Open: 1.1933 High: 1.1958 Low: 1.1912 Close: 1.1934

EUR/USD Technical

EUR/USD has shown little movement in the Asian and European sessions

• 1.1876 is providing support
• 1.1931 is fluid. Currently, it is a weak resistance line

Further levels in both directions:

• Below: 1.1876, 1.1777, 1.1657 and 1.1574
• Above: 1.1936, 1.2033 and 1.2108
• Current range: 1.1876 to 1.1936

OANDA’s Open Positions Ratio

EUR/USD is unchanged in the Monday session. Currently, short positions have a majority (63%), indicative of EUR/USD reversing directions and moving downwards.

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