EUR/USD daily chart with support and resistance lines on it. Click to enlarge:
- Eurozone Consumer Confidence: Monday: 15:00. Consumer confidence remains mired in negative territory, as consumers continue to be pessimistic over economic conditions in the eurozone. The February reading showed little change, with a reading of -7 points. The estimate for March stands at -14 points.
- PMIs: Tuesday, 8:15 in France, 8:30 in Germany, and 9:00 for the whole eurozone. The February PMIs showed growth in the services sector, but pointed to contraction in the manufacturing sector. Analysts are braced for very soft readings in March as the COVID-19 outbreak has paralyzed the eurozone economy. Eurozone PMIs are forecast to come in around 40.0 with the French PMI are projected to fall to around 39.5 points. German services PMI is expected in at 43.0 and the manufacturing PMI at 40.1 points.
- German Final Ifo Business Climate: Wednesday, 9:00. The indicator came in at 96.1 in February, beating the estimate of 95.0 points. The indicator has been above the 90-level since 2009, but is expected to decline to 87.9 in March.
- German GfK Consumer Climate: Thursday, 7:00. German consumer confidence has been steady and came in at 9.8 points. Analysts are braced for a significant slowdown, with a forecast of 8.2 points.
- Eurozone Monetary Data: Thursday, 9:00. M3 Money Supply accelerated to an annual growth rate of 5.2% in January, up from 5.0% a month earlier. Private Loans grew by 3.7% y/y, for a second straight month. We will now receive data for February. Money Supply is projected to remain at 5.2%, while Private Loans is expected to rise to 3.8 percent.
EUR/USD Technical analysis
Technical lines from top to bottom:
With EUR/USD posting sharp losses, we start at lower levels:
1.1119 remains relevant.
1.0925 (mentioned last week) is next.
1.0829 has switched to resistance for the first time since April 2017.
The round number of 1.07 is fluid. Currently, it is an immediate resistance line.
1.0620 is protecting the 1.06 level. 1.05 is next.
1.04 is the final support level for now.
I remain bearish on EUR/USD
The coronavirus outbreak continues to take a heavy toll on the eurozone economy, with much of the eurozone under lockdown. With the outbreak expected to worsen, the euro could fall even further.