EUR/USD dived to lower levels, but it was certainly not a one way street. Has it bottomed out? The big events coming up are a German survey and final inflation data for August. Here is an outlook on the highlights of this week and an updated technical analysis for EUR/USD, now on lower ground. The echoes from Draghi’s rate cuts and ABS continued weighing on the euro, as more analysts see the euro as a funding currency., but on the other hand, industrial production was strong and so was the German trade balance. In the US, the JOLTS number was OK, while jobless claims disappointed and retail sales beat. The greenback showed strength against many currencies, but the euro held up relatively well. [do action=”autoupdate” tag=”EURUSDUpdate”/]EUR/USD daily graph with support and resistance lines on it. Click to enlarge: Trade Balance: Monday, 9:00. The euro-zone enjoys a trade balance surplus, and this is one of the things that keeps the euro bid in times of trouble. After a positive figure of 13.8 billion in June, an even stronger number is predicted now, after Germany’s data beat expectations: 15.9 billion. German ZEW Economic Sentiment: Tuesday, 9:00. Staying in Germany, this important business survey has been on the back foot since the beginning of the year, falling and disappointing each time. It reached a low of 8.6 points in August and is now expected to stabilize around these levels, but slide just a bit more: 5.2 points. The all-European survey is predicted to drop from 23.7 points recorded in August to 21.3 points now. Italian Trade Balance: Wednesday, 8:00. This isn’t the biggest market mover normally, but this time we have two monthly releases at once. Italy enjoys a surplus in its trade. If both figures go in the same direction: both fall short of the previous 3.68 billion surplus or both exceed it, the publications could have an impact. Italy is expected to report a surplus of 1.33 billion for July and 2.47 billion for August. Final CPI: Wednesday, 9:00. The preliminary report for August showed a new multi-year low of 0.3% in headline inflation, and this is one of the drivers of more monetary stimulus. The upside comes from core inflation, which ticked up to 0.9%. Both numbers are likely to be confirmed now. German PPI: Friday, 6:00. Producer prices fell short of expectations in recent months, with no rise in prices in 2014. After a drop of 0.1% in July, the data for August is expected to show a drop of the same magnitude, but it might also finally show a rise, perhaps thanks to the fall of the euro. Current Account: Friday, 8:00. Similar to the trade balance figure, also the wider current account figure is positive. After a surplus of 13.1 billion in June, a larger figure is likely for July: 14.3 billion. * All times are GMT EUR/USD Technical Analysis Euro/dollar started the week by trading above the 1.2920 level (mentioned last week). After the pair lost that line, it reached a low of 1.2865 before climbing back up above 1.2920 – a line which serves as a clear separator of ranges. Live chart of EUR/USD: [do action=”tradingviews” pair=”EURUSD” interval=”60″/]Technical lines from top to bottom: 1.3295 is the first line for now: it was the low level in November. 1.3220 is the pre-gap line and now serves as important resistance. 1.3175 worked in both direction during 2013 and served as the bottom line of the range in August 2014. 1.3150 is was a low during August and now serves as resistance. Below, the round number of 1.31 served as resistance several times, and the all important figure below is 1.30, which is more than a round number. Below 1.30, we find support at 1.2960 which capped the pair’s recovery attempts after it fell to lower ground. The 1.2920 level was the initial low and has now turned into a pivotal line. 1.2860 is the recent 2014 low and is now key support. Very close, 1.2840 served as support in June 2013 and is the next line before the round number of 1.28, which also worked as support at around the same period of time. 1.2750 was the low where the pair traded last time it was around these levels: July 2013. This is followed by 1.2660 – a key line to the downside, which marks the beginning of long term uptrend support. Here is a closer look at the recent trading levels, using the hourly chart: Long term uptrend line still fought over After downtrend support was left behind, we are now reaching a much older line, which accompanied the pair since November 2012 and was touched twice in 2013 and since forgotten. The pair broke below the line, but managed to give another fight. I turn from neutral to bearish on EUR/USD The much needed consolidation could be over. We have finally seen more than a “dead cat” bounce and after this correction, the direction remains lower. Monetary policy convergence is the key: the ECB is about to launch its program soon while the Fed is nearing the end of its program. The pair is still far from the ECB comfort zone of 1.20-1.25 and we could see a resumption of the fall, even if Yellen does her best not to rock the boat. More: EUR/USD enjoys higher volatility, improved technical behavior EUR/USD settles under 1.29 – Is the pair oversold? Listen to our latest podcast about: gold and inflation, the Scottish referendum and the pound, and the FOMC meeting. And subscribe on iTunes. If you are interested a different way of trading currencies, check out the weekly binary options setups, including EUR/USD and more. Further reading: For a broad view of all the week’s major events worldwide, read the USD outlook. For the Japanese yen, read the USD/JPY forecast. For GBP/USD (cable), look into the British Pound forecast. For the Australian dollar (Aussie), check out the AUD to USD forecast. USD/CAD (loonie), check out the Canadian dollar forecast For the kiwi, see the NZDUSD forecast. Yohay Elam Yohay Elam Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts. Yohay's Google Profile View All Post By Yohay Elam EUR/USD ForecastMajors share Read Next USD/JPY Forecast Sep. 15-19 Kenny Fisher 8 years EUR/USD dived to lower levels, but it was certainly not a one way street. Has it bottomed out? The big events coming up are a German survey and final inflation data for August. Here is an outlook on the highlights of this week and an updated technical analysis for EUR/USD, now on lower ground. The echoes from Draghi's rate cuts and ABS continued weighing on the euro, as more analysts see the euro as a funding currency., but on the other hand, industrial production was strong and so was the German trade balance. In the US, the JOLTS number was… Top Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk.4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk.5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.