Euro Turns Bullish on Rise in Investors’ Confidence

EuroUS Dollar has regained its sanguine position previous week after the staggering positive non-farm employment changes. However, the economic data of Eurozone as on June 2016 shows a drop in the factory orders of Germany. The industry production in Italy has also considerably reduced and this clearly shows that the position of Euro has weakened.

The market participants were optimistic that the US Dollars will extend this week but with the latest economic data from the United States and the opinion of the analysts about the prospects of a rate accretion, it is clear now that there is no room for bullish sentiments for US Dollars.

As a result of which we know believe that the EUR/USD currency pair will be able to take back the territory it had lost the previous week.

The labour productivity of non-farm business region has shown a steep decline by 0.5 percent in Q2 of the financial year 2016. This data has been revealed by the US Bureau of Labour Statistics. This institution has further reported that the output productivity has registered a meagre rise by 1.2 percent while the number of working hours grew up by 1.8 percent.  The Department of Labour Statistics has further stated that there is a decline of 0.4 percent in productivity annually.

ET NOW

The report has given room for concern about the likeliness in Fed Hike in the remaining two quarters of this year. The Chief Globalist at Daiwa Securities; Mr Hirokazu Kabeya is of the opinion that United States economy is not doing extremely well at the present time and it should not have given rise to a Fed hike. Masahiro Ichikawa who is a senior strategist at the Sumitomo Mitsui backs the views of Hirokazu by stating that the United States is currently experiencing productivity growth at a very low level and it will continue in the 3rd quarter and so there is no room for a hike in the interest rate of Fed.

According to the monthly sentiment survey report from Sentix Research group of Frankfurt the investors of Eurozone have brushed aside all fears related to Brexit. The index has moved from 1.7 to 4.2 in the month of July contrary to the expectations of the analysts who were anticipating a reading somewhere around 3.6. Hence, in the coming days, the EUR/USD currency will continue to enjoy an upward trend.

Amongst oscillators, RSI has been able to able to enter the bullish zone whereas stochastically is on the verge of entering. The currency pair EUR/USD is also progressing up the channel and it is likely that the trend will continue and the pair will be able to register the resistance at 1.1330. The EUR/USD currency pair’s support lies at 1.1100.

Eur Usd Pair Aug 12th 2016

A Forex trader can take a long position somewhere around 1.1100 with stop loss order below 1.0950. The trader can close the long position at 1.1300.

Similarly, a trader in binary options with the help of a preferred broker can pick one touch call option contract. The trader can increase the chances of profiting from the trade by making a proper contract target price of 1.13 or lower. The trader will benefit a lot if the contract’s expiry date falls in the middle of September.


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