EUR/USD daily chart with support and resistance lines on it. Click to enlarge:
- German Ifo Business Climate: Monday, 9:00. Business confidence has been improving and reached 96.3 in December, up from 95.0 a month earlier. The upswing is expected to continue in January, with an estimate of 97.1 pts.
- German GfK Consumer Climate: Wednesday, 7:00. Consumer climate dipped to 9.6 in December, down from 9.7 a month earlier. The estimate for January stands at 9.6 pts.
- Monetary Data: Friday, 9:00. M3 Money Supply remained unchanged at 5.6% in November. The estimate for December stands at 5.5%. Private Loans has been fairly steady in recent months and was unchanged at 3.5% in November.
- German Preliminary CPI: Thursday, All Day. German consumer inflation rebounded with a gain of 0.5% in December after a decline of 0.8% in the previous release. Another decline is projected in January, with an estimate of -0.6%.
- German Retail Sales: Friday, 7:00. This consumer spending indicator has been showing sharp swings of late. After a decline of 1.9% in October, retails sales rebounded with a sharp gain of 2.1% in November. The estimate for December stands at -0.5%.
- Spanish Flash GDP: Friday, 8:00. GDP slipped in the third quarter to 0.4%, its lowest level since 2014. Another gain of 0.4% is expected in Q4.
- Eurozone Inflation: Friday, 10:00. The initial estimate for January CPI is projected at 1.4%, just above the 1.3% gain in December. The initial core release is expected at 1.2% in January, compared to 1.3% in December.
EUR/USD Technical analysis
EUR/USD ended the week with losses, falling to a low of 1.1023 in the Friday session. This was the pair’s lowest level since December 2.
Technical lines from top to bottom:
1.1390 has held firm in resistance since June.
1.1290 was last tested in early July. 1.1215 is next.
1.1119 has some breathing room in resistance.
1.1025 (mentioned last week) is fluid, as EUR/USD starts the week just below this line.
1.0925 is providing support.
1.0829 has held in support since April 2017.
1.0690 is the final support level for now.
I remain bearish on EUR/USD
The eurozone economy continues to struggle, while the U.S. economy is performing well. The recent outbreak of the coronavirus which originated in China has spooked investors, which has boosted safe-haven assets such as the U.S. dollar.