Sorry, you need to enable JavaScript to visit this website.

EUR/USD Forecast 01/07/2013

You are here

EUR/USD Chart 01/07/2013
5/5 of 2 ratings

Is the Euro going to recover some lost ground?

With present levels of the EUR/USD binary options players should be alert to a potential for reversing the sharp gains that the USD has put in place in the past two weeks since Ben Bernanke’s press conference that boosted the greenback.

While the nearest long term support level is still not tested we remain cautious for trading puts at current levels. Let’s take a look at the factors in more detail.

Firstly the fundamentals for the Euro Zone are definitely turning – it remains to be seen for how long but depending on the raft of data released later this week we have the vision of a moderately bullish picture for the Euro in the short term. We are sure some market players would like to take some profits ahead of “Super Mario” Draghi’s speech.

The Eurozone’s manufacturing PMI numbers for the month of June marked a 16-month high of 48.8 with numbers last month hitting 48.3 and the flash preliminary index coming out at 48.7. While still in reverse gear we can see some bright spots – for example Spain which reported its number at 50.0 flat which is the first time in 25 months that the reading is at or above the contraction mark of 50 points.

Italy’s numbers were also way better than expected being reported at 49.1 with the previous month stating 47.3 and expectations of 47.8 points. Binary options traders should remember that any reading above 50 signifies the particular sector of the economy is growing.

In other news from the European Morning Euro zone joblessness was reported at a record high in May, and consumer prices rose in June for the second month in a row and forestalled the threat of deflation hanging over the currency union’s weak economy. The consumer price inflation increased to 1.6 percent year-on-year from 1.4 percent in May. That was the second month of gains in a row with the lowest point having been set in April at 1.2 percent. The not so positive part of these news was that prices were driven up by food, alcohol and tobacco. The June headline number remains below the European Central Bank's target of close to, but not above, 2 percent year-on-year.

In other news from the European Morning Euro zone joblessness was reported at a record high in May, and consumer prices rose in June for the second month in a row and forestalled the threat of deflation hanging over the currency union’s weak economy. The consumer price inflation increased to 1.6 percent year-on-year from 1.4 percent in May. That was the second month of gains in a row with the lowest point having been set in April at 1.2 percent. The not so positive part of these news was that prices were driven up by food, alcohol and tobacco. The June headline number remains below the European Central Bank's target of close to, but not above, 2 percent year-on-year.

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.

You may also read