Daily Forex News and Watchlist: EUR/USD

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Traders are buying “risky” assets today and EUR/USD is taking advantage of the intraday trend!

How high can EUR/USD fly before it attracts selling pressure again?

Before moving on, ICYMI, yesterday’s watchlist looked at EUR/AUD’s range resistance after Australia printed a strong inflation report. Be sure to check out if it’s still a good play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

U.S. Durable Goods Orders for August: 0.2% m/m (-1.4% m/m forecast; -5.6% m/m previous); Core Durable Goods Orders came in at 0.4% m/m (0.6% m/m forecast; 0.1% m/m previous)

SNB’s quarterly bulletin: SNB kept policy rate at 1.75% to counter inflationary pressure. SNB is open to further tightening if needed and willing to intervene in forex markets. Deposits will be remunerated at 1.25% above a certain threshold.

EIA crude oil inventory for week ending Sept. 22, 2023: -2.17M bbl (-2.14Mbbl previous change) to 416.3M bbl

Trading of Evergrande shares halted after its founder was reportedly placed under police surveillance and fears of collapse grew

ANZ: New Zealand’s business confidence index turned positive, up from -3.7 to 1.5 in September; Jury remains out on whether prices are falling “fast enough to bring core inflation pressures down in a timely fashion

Australia’s retail sales slowed down from 0.5% m/m to 0.2% m/m in August as consumers reacted to higher living expenses and borrowing costs

North Rhine Westphalia (Germany) CPI slowed down from 0.5% m/m to 0.2% m/m in September

Spain’s CPI accelerated from 5.9% y/y to 4.2% y/y in September

Price Action News

Overlay of GBP Pairs 15-min Chart

Overlay of GBP Pairs 15-min Chart

There were no U.K.-related reports released earlier today but the British pound gave risk assets like AUD and NZD a good fight over today’s biggest mover.

One possible reason for GBP’s upswings across the board is the U.K. 10-year bond yields jumping above the closely watched 4.4% threshold – the highest since September 11! – and attracting demand for the British pound.

As of writing, GBP is registering the most gains against USD and CAD and is only slightly stronger than AUD and NZD.

ECB’s economic bulletin at 8:00 am GMT
U.S. final GDP at 12:30 pm GMT
U.S. initial jobless claims at 12:30 pm GMT
FOMC member Austan Goolsbee to give a speech at 1:00 pm GMT
U.S. pending home sales at 2:00 pm GMT
FOMC member Lisa Cook to give a speech at 5:00 pm GMT
FOMC Chairman Powell to give a speech at 8:00 pm GMT
Tokyo’s core CPI at 11:30 pm GMT

Japan’s unemployment rate at 11:30 pm GMT
Japan’s preliminary industrial production at 11:50 pm GMT
Japan’s retail sales at 11:30 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

EUR/USD 15-min Forex

EUR/USD 15-min Forex Chart by TV

In case you missed it, CPI data published from Spain earlier today supported a “higher for longer” plan for the ECB’s interest rates.

It also didn’t hurt that traders are more open to taking risks after days of weaknesses.

EUR/USD, in particular, saw a Double Bottom pattern near the 1.0500 major psychological handle and is now trading above the 1.0525 mark.

How high can EUR/USD fly before enough sellers step in to extend the pair’s weeks-long downtrend?

Traders can keep close tabs on the 1.0560 – 1.0570 zone that’s kinda close to the R1 (1.0560) Pivot Point level and 200 SMA resistance in the 15-minute time frame.

If we don’t see fresh catalysts to reinforce the “risk-friendly” vibe in the markets, then EUR/USD’s upswing may lose momentum.

This is where today’s U.S. data releases come in. In a few hours, we’ll see Uncle Sam’s final Q2 GDP reading, initial jobless claims, and pending home sales. Fed Chairman Powell will even give a speech!

If today’s U.S. reports inspire risk-taking during the U.S. session, then EUR/USD could revisit higher areas of interest like 1.0600 before taking a chill pill from its upswing.

But if the U.S. data releases support a “soft landing” situation for the U.S. economy, or if Powell’s speech underscores the Fed’s more hawkish bias compared to its peers, then EUR/USD may see bearish candlesticks and return to its weekly lows near 1.0500.

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