16 Apr 2018
The EUR/USD is trading at around 1.2381 up 0.41% on Monday as the pair is trying to reclaim last week’s highs at 1.2397 and possibly advance further up.
On the macroeconomic front, the freshly released US retail sales increased 0.6% m/m in March after falling -0.1% m/m in February. The retail sales ex-autos matched analysts’ expectations at 0.2% m/m in March while the section of the retail sales called control group, which is included in the GDP, also came in line at 0.4% m/m as expected by analysts. On the other hand, the Empire State Manufacturing Index decreased to 15.8 in April from 22.5 the month earlier; analysts were expecting 18.6 in April. The EUR/USD gained about 20 pips on the news which now is directed towards the 1.2400 handle.
Looking ahead, the New-York session is expected to see three Fed speakers on Monday. Dallas Fed President R.Kaplan, a non-voter in the rate-setting FOMC and leaning toward the hawkish side, rather dovish Minneapolis Fed President N.Kahkari (also non-voter) and Atlanta Fed President R.Bostic, FOMC voter and centrist.
The recent EUR/USD up move up in the European session was mainly driven by US dollar weakness as an escalation of the US-Russia tensions over Syria is seen as US dollar negative. The US-led airstrike on Syria over the weekend didn’t lead to a flight to safety as it was considered as a once-off attack. However, diplomatic uncertainties opposing the US and Russia remain high. The US is still looking for “all kinds of options” to further sanction Russia, which backs the Syrian regime.
“This month, the US took action against several Russian oligarchs and businesses, including imposing sanctions on RFC Bank, a subsidiary of a state-owned weapons trading company that Washington said was responsible for transactions with Syria.” according to the Financial Times.
Earlier in the day, investors shrugged-off upbeat comments by the Minneapolis Federal Reserve President Neel Kashkari.
EUR/USD 4-hour chart
Resistance is seen at 1.2397 and at 1.2477 swing highs while support lie at 1.2300 and 1.2260 swing lows
Trading foreign exchange on margin carries high potential rewards but also high potential risks that may not be suitable for all investors. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience and risk appetite. Past performance is not indicative of future results, which can vary due to market volatility. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.
Any opinions, news, research, analyses, prices or other information contained on this website or linked to from this website are provided as general market commentary and do not constitute investment advice. AUSFOREX does not accept liability for any loss or damage, including any loss or profit, which may arise directly or indirectly from use of or reliance on such information.