EUR/USD daily chart with support and resistance lines on it. Click to enlarge:
- Spanish Parliamentary Election: Sunday, All Day. Spaniards are off to the polls for the second time this year. With no clear front runner, the result could lead to political instability in the eurozone’s fourth-largest economy.
- German ZEW Economic Sentiment: Tuesday, 10:00. This key confidence indicator remains mired in negative territory. The index dipped to -22.5 in October, but is expected to improve to -13.2 in November. The all-eurozone index is also expected to improve to -11.5, up from -23.5 points.
- German Final CPI: Wednesday, 7:00. German inflation remains subdued and is expected to improve to 0.1% ijn October, confirming the initial estimate.
- Eurozone Industrial Production: Wednesday, 10:00. The eurozone manufacturing sector has struggled, with this indicator posting two declines in the past three readings. Another decline is expected in September, with an estimate of -0.2%.
- German Preliminary GDP: Thursday, 7:00. The German locomotive contracted by 0.1% in Q2, and another decline of 0.1% is expected in Q3, which could weigh on the euro.
- Eurozone Flash GDP: Thursday, 10:00. This is the second estimate of GDP, and is expected to remain steady at 0.2% in September. This would confirm the initial estimate back in October.
- Eurozone Final CPI: Friday, 10:00. Eurozone inflation remains low, with the September release projected to drop from 0.8% to 0.7%. This would confirm the initial estimate.
EUR/USD Technical analysis
Technical lines from top to bottom:
1.1390 was a stepping stone on the way up in late January and capped EUR/USD earlier. 1.1345 is next.
1.1290 has held in resistance since the first week of July. 1.1215 is next.
1.1119 (mentioned last week) remains relevant.
1.1025 has switched to a resistance role after sharp losses by EUR/USD last week.
1.0950 is the first support level.
1.0829 has held in support since April 2017.
1.0690 is the final support level for now.
I am neutral on EUR/USD
The euro continues to show strong swings in both directions, making it difficult to establish a trend. The U.S. economy continues to outperform the eurozone, but recent rate cuts by the Federal Reserve has investors looking for alternatives to the U.S. dollar.