EUR/USD has edged higher on Monday, as the pair trades at 1.0860. On the release front, German Ifo Business Climate climbed to 112.3, above the forecast of 111.2 points. In the US, there are no economic indicators, but we’ll hear from two FOMC members – Charles Evans and Robert Kaplan. On Tuesday, the US releases CB Consumer Confidence.
The week has started on a bright note in Europe. German Ifo Business Climate rose to 112. 3 points, its highest level since July 2011. The release underscores high optimism in the business sector, despite rumblings of protectionism from the US and the uncertainty over Brexit. Germany, the largest economy in Europe, continues to post strong numbers, which has been good news for the eurozone economy. Last week’s PMIs pointed to expansion in the manufacturing and service sectors. German and eurozone Manufacturing PMIs both beat their estimates and hit their highest levels since 2011. The markets are keeping a close eye on Germany, which later this week releases CPI, retail sales and unemployment claims. One soft spot in the economy, however, is consumer confidence. GfK German Consumer Climate lost ground for a second straight month, as the indicator dropped to 9.8 in March, its lowest level since November 2016. Eurozone Consumer Confidence remains weak, as the indicator posted a decline of -5 in March, almost unchanged from a month earlier. These soft numbers are largely a result of higher inflation, as consumers are concerned about their reduced purchasing power.
The market euphoria over President Trump’s upset election win is long past. The inquiry into the Trump administration’s links with Russia continues to make headlines, and is another cause for concern for nervous investors. Trump has been in office for over two months, but he has yet to provide any details over even an outline of economic policy. Last week, Trump’s proposed bill to change Obamacare was not even voted on, as the White House could not garner enough support to pass the bill. This debacle will only increase market uneasiness over Trump, and could send the dollar downwards even further.
EUR/USD Fundamentals
Monday (March 27)
- 8:00 German Ifo Business Climate. Estimate 111.2. Actual 112.3
- 8:00 Eurozone M3 Money Supply. Estimate 4.9%. Actual 4.7%
- 8:00 Eurozone Private Loans. Estimate 2.3%. Actual 2.3%
- 17:15 US FOMC Member Charles Evans Speech
- 22:30 US FOMC Robert Kaplan Speech
Tuesday (March 28)
- 14:00 US CB Consumer Confidence. Estimate 113.9
*All release times are EST
*Key events are in bold
EUR/USD for Monday, March 27, 2017
EUR/USD March 27 at 1:50 EST
Open: 1.0846 High: 1.0873 Low: 1.0837 Close: 1.0866
EUR/USD Technical
| S1 | S2 | S1 | R1 | R2 | R3 |
| 1.0506 | 1.0616 | 1.0708 | 1.0873 | 1.0985 | 1.1097 |
EUR/USD was flat in the Asian session and has edged up in European trade
- 1.0708 continues to provide support
- 1.0873 is the next resistance line
Further levels in both directions:
- Below: 1.0708, 1.0616 and 1.0506
- Above: 1.0873, 1.0985 and 1.1097
- Current range: 1.0708 to 1.0873
OANDA’s Open Positions Ratio
EUR/USD ratio has shown movement towards short positions. Currently, short positions have a strong majority (63%), indicative of trader bias towards EUR/USD reversing directions and moving lower.