The Euro is treading water on Tuesday, but trying to recover from early session weakness. Increasing demand for risk may be helping to underpin the single-currency.
Earlier today, the German ZEW headline numbers for April jumped to 3.1 versus 0.8 estimates and the -3.6 reported last month. However, sub-index current conditions declined sharply to 5.5 versus 8.0 expected and last month’s 11.1 read.
ZEW President Professor Achim Warmbach noted: “The slight improvement recorded by the ZEW Indicator of Economic Sentiment is largely based on the hope that the global economic sentiment will develop less poorly than previously assumed. The postponement of the Brexit deadline may also have contributed to buoy the economic outlook. By contrast, the latest figures regarding incoming orders and industrial production in the German industry point to a rather weak economic development.”
At 13:00 GMT, the EUR/USD is trading 1.1298, down 0.0006 or -0.05%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. A trade through 1.1324 will signal a resumption of the uptrend. A trade through 1.1184 will change the main trend to down.
The minor trend is also up. A trade through 1.1230 will change the minor trend to down. This will also shift momentum to the downside.
The main range is 1.1448 to 1.1184. Providing resistance is its retracement zone at 1.1316 to 1.1347.
On the upside, major resistance comes in at 1.1374 to 1.1420. On the downside, the major support is 1.1185.
Daily Technical Forecast
Based on today’s wide trading range, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to 1.1317 and 1.1284.
Holding above the Gann angle at 1.1284 will indicate the presence of buyers, but a move through 1.1317 could trigger an acceleration to the upside with 1.1324 and 1.1347 potential upside targets.
The inability to overcome 1.1317 will signal the presence of sellers, but look for an acceleration to the downside if 1.1284 fails as support. This could lead to an eventual test of the next uptrending Gann angle at 1.1247.