- – The Euro recently recovered from the 1.0351 low against the US Dollar, and traded above 1.0450.
- – The recovery could not last long as there was a failure just below the 1.0500 level in EURUSD.
- – In the Euro Zone, the German GfK Consumer Confidence posted an increase from 9.8 to 9.9 in Jan 2016.
German GfK Consumer Confidence
Today in the Euro Zone, the German GfK Consumer Confidence, which is a leading index that measures the level of consumer confidence in economic activity was released. The market was aligned for no change from the last reading of 9.8 in Jan 2016.
However, the result was better, as the German GfK Consumer Confidence posted an increase from 9.8 to 9.9 in Jan 2016. The report published highlighted positive points, and mentioned that “Economic expectations have increased slightly, while income expectations have seen significant growth. In contrast, propensity to buy has suffered moderate losses.”
Overall, the result was encouraging, but it may fail to help the Euro to gain traction against the US Dollar for a break above 1.0500. In another release, the French Gross Domestic Product released by INSEE posted a growth rate of 0.2%, just as the market expected in Q3 2016.
EUR/USD Technical Analysis
The Euro declined heavily recently against the US dollar, and posted a new low of 1.0351 this week. Later, a recovery was started in EUR/USD, taking the pair above the 1.0450 level. The pair traded just below the 1.0500 at 1.0498 where it found sellers and moved down.
During the downside move, the pair broke a bullish trend line on the 4-hours chart at 1.0440. Moreover, there was also a move below the 23.6% Fib retracement level of the last wave from the 1.0351 low to 1.0498 high.
It looks like the pair has made a short-term top at 1.0498 and may decline further. A test of the 50% Fib retracement level of the last wave from the 1.0351 low to 1.0498 high at 1.0420 is possible. The 100 simple moving average (H4) is also positioned near the same level to act as a support in that case.
Tags: EUR/USD Technical Analysis, Euro, France GDP, German GfK Consumer Confidence, US Dollar, USD