The main pair is getting more and more close to 1.4000, which is the maximum of autumn 2011,
but buyers still are not strong enough. Overbuying of the asset plays against the “bulls”.
The pair is not discouraged by the height and continues to climb up, though there is not much
base for it. Still buyers are ignoring overbought, though it is clear that one spark here is enough start correction.
Yesterday’s comments of the European Central Bank, which triggered a
new turn of the Euro purchase, shouldn’t be perceived literally: statistics
suggest that absolute recovery of the market in Europe is still far, labor
market remains without progress perspective, industrial production is reducing,
export is weak. Some positive trends are seen in services, but alone it is not
enough. The fact that the EU put up with low inflation means only that the ECB
had been evaluating potential struggle with weak CPI for too long.
On Thursday the ECB representative mentioned that inflation expectations would
be 2% in the near future. 2% is the target of absolutely healthy economy. Obviously
Europe is not up to the challenge in terms of that index now. Yesterday’s data on
the US were not noticed by the market. February retail sales grew by 0.3% against
the forecast of 0.2%. Besides amount of demands for unemployment benefit constituted
315K against the forecast of 330K.
Yesterday the pair has got above 1.3960 getting close almost to 1.4000. The dip is perhaps
a certain way for the pair to catch its breath before the final leap. Analysts expect the
Euro to attempt testing the peak in the near term.
The pair is under downward pressure. Yesterday’s abrupt decline is followed by some consolidation.
Support is near 101.50. Most likely it is not going to hold for too long, and the bearish trend
is going to resume soon.
The pattern of the past trading day resembles the ones of two previously assets.
The general outlook is bearish. The slow pace of decline has resumed after big scale fluctuations.
04:30 JPY Industrial Production (MoM) 08:15 CHF Swiss PPI (MoM) 09:30 GBP Trade Balance 12:30 USD Core PPI (MoM) 12:30 USD PPI (MoM) 13:55 USD Michigan Consumer Sentiment