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Analysis of the trading week on 25-29 October on EUR/USD. The paradox of the Euro currency. Zero reaction of traders in the inflation report

RSS feed for Forex Review 29.11.2019 at 15:31

Daily analytical reviews of the Forex market


EUR/USD November 29, on 4-hour chart has resumed the process of falling after a small growth of quotations based on the rebound from the level of correction 61.8% - 1.0995 and the formation of two bullish divergences. However, at the moment we can say that the re-release from level of correction 61.8% will likely not be, thus, the Euro-dollar pair resumed the process of falling towards the level of 76.4% - 1,0952. The EUR / USD pair continues to trade within the downward trending corridor, which increases the probability of further decline.

Today, background information was only one report from the Eurozone preliminary inflation figure for November. Since yesterday German inflation was very upset investors, not showing the expected acceleration, then and now, many traders were expecting that European inflation will not change compared to the previous value. However, with full confidence we can say that this report has managed to surprise, as inflation in the EU increased to 1.0% yoy at the forecast to just 0.8 percent y/y And the most interesting that it does not help the European currency. In the U.S. session traders have resumed all the same sluggish sales of the Euro-dollar, and total activity absolutely in the Forex market has not changed. That day, when the Euro was at least a small chance for growth resumed a downward trend.

What can be said in General for the current week? I believe that, first, the traders did not pay attention to economic reports, which had at least a little, but they could affect the movement of EUR/USD currency pair. Wednesday pretty strong reports from America on orders for durable goods and GDP could contribute to increased demand for the US dollar. Today, when inflation in the EU has shown a positive trend, is the growth of the Euro we saw the fall. Secondly, in any case, trading activity remains extremely low, so low that in General it is not clear that right now the markets react.

it Can be assumed that traders with great interest reacted to the news on the negotiation process between China and the United States, or fueling the passion between these same countries due to the signing of Donald trump's two laws that define the new relations between Washington and Hong Kong. But this is unlikely. Just because this week trade negotiations have not advanced a single inch forward, no news on this topic did not exist, the response of the Chinese government to "trick" trump also is not followed, as well as official statements that now parties will be more difficult to negotiate on a trade agreement.

the Only thing there is no questions this week, so it's a General news background and is in accordance with the direction of the trend corridor. In General, the economic reports from America did not disappoint, and in Europe this week came out only the data for unemployment (has decreased to 7.5%) and inflation (not final value). Both values also were good, but they do not alter the overall negative picture of the state of the economy of the European Union, and by the end of the month that inflation may be able to slow down.

the Forecast for EUR/USD and the recommendations of traders:

29 Nov traders resumed the process of falling, so today and next week the demand for euros will probably remain low, allowing traders to sell the pair. Trading activity remains extremely weak. Thus, I recommend to continue to sell the pair if there is a consolidation under the level of correction 61.8% from the level of 76.4% - 1,0952.

the Fibo Grid built on the extrema of October 1, 2019 October 21, 2019.

the Material has been provided by InstaForex company -