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On Friday May 12th, trading on the Euro closed up. Before the US session, the pair was trading within a range of 1.0850 to 1.0880. After the release of US statistics, the Euro strengthened to 1.0934. Although the data was mixed, the overall effect on the dollar was negative. CPI and retail sales figures came out worse than expected.
US statistics:
- Preliminary data from the University of Michigan consumer sentiment index for May came out at 97.7 (forecast: 97.0, previous reading: 97.0).
- Retail sales grew in April by 0.4% (forecast: 0.6%, previous reading: 0.1%).
- Non-auto retail sales rose by 0.3% in April (forecast: 0.3%, previous reading: 0.3%).
- The CPI in the US for April was 0.2% MoM and 2.2% YoY (forecast: 0.2% MoM, 2.3% YoY, previous reading: -0.3% MoM, 2.4% YoY).
Market expectations:
Given that the Euro/dollar pair closed up on Friday, today I’m expecting it to slide to 1.0893. The Stochastic oscillator is in neutral territory at around 41%. Due to this, I’m expecting to see Friday’s rally being corrected downwards from around 1.0942 level. The economic calendar is empty today. Volatility could be increased this evening by British Prime Minister Theresa May, who is scheduled to speak.
Day’s news (GMT+3):
- 10:15 Switzerland: producer and import prices (Apr);
- 15:30 USA: NY Empire State manufacturing index (May);
- 17:00 USA: NAHB housing market index (May);
- 22:00 UK: statement from Prime Minister Theresa May;
- 23:00 USA: net long-term TIC flows (Mar).
EURUSD rate on the hourly. Source: TradingView.
Intraday forecast: low: 1.0893, high: 1.0942, close: 1.0902.
The news on Friday took the EUR/USD pair up to 1.0934. This growth stopped between the 67th and 90th degrees. Today is Monday, and so my forecast for today goes against Friday’s rally. I’m expecting the rate to start falling from the 90th degree. I haven’t factored in any potential developments in the news. I’m expecting the rate to return to the balance line at around 1.0893/900.
