EUR/USD daily chart with support and resistance lines on it. Click to enlarge:
- Industrial Production: Monday, 9:00. The manufacturing sector continues to struggle, with only one gain in the past six releases. The markets are expecting a gain of 0.3% in the August release.
- French Final CPI: Tuesday, 6:45. Inflation in the eurozone’s second-largest economy improved in August, with a solid gain of 0.5%. However, investors are expecting a decline of 0.3% in September.
- German ZEW Economic Sentiment: Tuesday, 9:00. This key confidence indicator remains mired deep in negative territory, pointing to pessimism over the economic outlook. The forecast for October is -27.0. The eurozone indicator is also expected to weaken, with an estimate of -26.7.
- Eurozone Inflation: Wednesday, 9:00. CPI has been pegged at a weak 1.0% for the past two months, and the estimate for September stands at 0.9%. These numbers are well below the ECB inflation target of around 2.0%.
EUR/USD Technical analysis
Technical lines from top to bottom:
We begin with resistance at 1.1390. This is followed by 1.1345.
1.1290 has held in resistance since the first week of July.
1.1215 is the next resistance line.
1.1119 (mentioned last week) is next.
1.1025 has held in resistance since September 23.
1.0950 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 continues to struggle and the euro remains below 1.10, as sentiment towards the euro remains weak. Soft global conditions have hampered the manufacturing sector in Germany and the rest of the bloc.