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EUR/USD Threatens Monthly Opening Range Ahead of OMT Ruling
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Talking Points:
- EUR/USD Threatens Monthly Opening Range Ahead of EU Court Ruling on ECB’s OMT Program.
- GBP/USD Range in Focus as BoE Governor Mark Carney Continues to See Higher Interest Rates.
- USDOLLAR Vulnerable to Larger Correction on Dismal Retail Sales Report.
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EUR/USD
Chart - Created Using FXCM Marketscope 2.0
EUR/USD remains at risk for a further decline as it threatens monthly opening range, while the Relative Strength Index (RSI) continues to hold in oversold territory.
However, may see a relief rally as the European Court of Justice is expected to rule in favor of the European Central Bank’s Outright Monetary Transactions (OMT) program.
Seeing increased volatility in the DailyFX Speculative Sentiment Index (SSI) as retail crowd flipped back to net-long EUR/USD on January 13, with the ratio currently standing at +1.39.
GBP/USD
Despite the marked slowdown in the Consumer Price Index (CPI), GBP/USD remains at risk for a larger correction as Bank of England (BoE) Governor Mark Carney continues to see higher borrowing-costs in the U.K., while the RSI comes off of oversold territory.
Nevertheless, long-term outlook remains bearish as GBP/USD continues to operate within the downward trending channel carried over from back in June; will watch former support zones for new resistance.
Next topside level of interest for GBP/USD comes in around 1.5300 (23.6% retracement) to 1.5320 (78.6% retracement).
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Read More:
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USDJPY Threatens Opening Range- Sub 118 Targets In View
USDOLLAR(Ticker: USDollar):
Index | Last | High | Low | Daily Change (%) | Daily Range (% of ATR) |
DJ-FXCM Dollar Index | 11646.86 | 11678.14 | 11611.31 | 0.10 | 151.16% |
Chart - Created Using FXCM Marketscope 2.0
Dow Jones-FXCM U.S. Dollar struggling to hold its ground despite the slew of better-than-expected confidence surveys; may face sideways price action amid the string of closes above 11,623 (100% expansion).
However, a decline in U.S. Retail Sales may dampen the appeal of the greenback & drag on interest rate expectations especially with the 2015 rotation within the Federal Open Market Committee (FOMC).
Will continue to watch the near-term range as USDOLLAR remains capped around 11,721 (38.2% expansion).
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Release | GMT | Expected | Actual |
NFIB Small Business Optimism Survey (DEC) | 14:00 | 98.5 | 100.4 |
IBD/TIPP Economic Optimism (JAN) | 15:00 | 48.7 | 51.5 |
JOLTS Job Openings (NOV) | 15:00 | 4850 | 4972 |
Monthly Budget Statement (DEC) | 19:00 | $3.0B | -- |
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--- Written by David Song, Currency Analyst
To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.
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