By Matthew Anthony, Alpari analyst
On Wednesday the 15th of May, trading on the euro closed down by just 3 pips. During the European session, the EURUSD rate dropped to 1.1178. In the US session, the bulls recovered their losses on the back of news that President Trump will delay his decision on car tariffs by up to 6 months. An official statement is expected on Saturday.
Day’s news (GMT+3):
- 10:30 Eurozone: ECB’s Praet speech.
- 11:15 Germany: German Buba President Weidmann speech.
- 12:00 Eurozone: trade balance (Mar).
- 15:30 Canada: manufacturing shipments (Mar).
- 15:30 US: Philadelphia Fed manufacturing survey (May), building permits (Apr), housing starts (Apr), initial jobless claims (10 May).
- 18:15 Canada: BoC’s Governor Poloz speech.
- 19:15 US: Fed’s Brainard speech.
- 20:30 UK: BoE’s Haskel speech.
- 21:00 Eurozone: ECB’s Cœuré speech.
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The test of the 67th degree happened just as expected. The pair dropped from 1.1217 to 1.1178. After a sharp rebound to 1.1225, trading stabilised at around 1.1205. At 09:00 UTC+3, the pair approached the balance line. In my forecast, I expect the euro to rise to the 45th degree and break the trend line. The stochastic is in the sell zone, so I think this growth will start from 1.12. We’re currently trading at 1.1208.
The euro crosses are showing mixed dynamics. The single currency is trading down against the yen and Swiss franc. Notice anything about these currencies? The euro is declining against the safe havens, so the drop could intensify later in the day.
I also think the euro will rise against the pound, given that the Labour Party has announced that due to differences in opinion, it will not support Theresa May’s deal without reaching a compromise.