Although this week there has not been currently significant macro data set for a release, the market volatility was reflecting fundamentals, mostly related to actuel narrative around trade tariffs. The US Administration was commenting on the possibility of setting a 50% trade tariff on goods coming from the EU, which brought back higher volatility on financial markets, and impacted the drop in value of US Dollar. As for macro data posted during the week, the Existing Home Sales reached 4M in May, which was a change of -0,5% for the previous month. At the same time, New Home Sales in April were higher by 10,9% in April compared to the previous month.
The final inflation rate in the Euro Zone in April was standing at 0,6% in April, and 2,2% on a yearly level. The PPI in Germany in April dropped by -0,6% for the month, bringing the indicator down by -0,9% on a yearly basis. The HCOB Manufacturing PMI flash for May in Germany was standing at 48,8, while the same indicator in the Euro Zone reached 49,4, and was in line with market expectations. The Ifo Business Climate in May in Germany reached 87,5 and was in line with forecast. The GDP Growth rate final for Q1 in Germany was 0,4%, higher from estimated 0,2% for the quarter. At the same time the GDP growth for the year reached 0%, and was a bit better from forecasted -0,2%.
The previous week was promising to be a calm one when macro data were in question, however, the higher volatility was induced by fundamentals, related to the narrative regarding trade tariffs. The eurusd currency pair was traded between levels of 1,1166 up to 1,1365. The RSI ended the week at the level of 58, but set the path toward the higher grounds, eyeing the overbought market side. The MA50 continues to diverge from MA200, indicating that the potential cross is not in the store for some time in the future.
Current charts are pointing toward the relatively weaker short term resistance level at 1,1380. In case that this level is breached to the upside in the week ahead, then the eurusd will head toward the 1,1480 which is the historical resistance line for the eurusd pair. In this scenario, it would mark a double top formation in technical analysis from which short term reversal could be expected. The second option is that the market starts weekly trading in a more relaxed mode, and revert from current levels. In this case, the next stop of the currency pair will be around the level of 1,1280. Still, it should be considered that the narrative around tariffs on EU goods will continue in a week ahead, which will bring some higher volatility and the PCE data are set for release which could be another trigger for volatility.
Important news to watch during the week ahead are:
EUR: GfK Consumer Confidence in June for Germany, Unemployment rate in in Germany in May, Retail Sales in April in Germany, Inflation rate preliminary for May in Germany,
USD: Durable Goods Orders in April, CB Consumer Confidence in May, FOMC Meeting Minutes, GDP Growth rate for Q1, second estimate, PCE Price Index in April, University of Michigan Consumer Sentiment final for May.
The final inflation rate in the Euro Zone in April was standing at 0,6% in April, and 2,2% on a yearly level. The PPI in Germany in April dropped by -0,6% for the month, bringing the indicator down by -0,9% on a yearly basis. The HCOB Manufacturing PMI flash for May in Germany was standing at 48,8, while the same indicator in the Euro Zone reached 49,4, and was in line with market expectations. The Ifo Business Climate in May in Germany reached 87,5 and was in line with forecast. The GDP Growth rate final for Q1 in Germany was 0,4%, higher from estimated 0,2% for the quarter. At the same time the GDP growth for the year reached 0%, and was a bit better from forecasted -0,2%.
The previous week was promising to be a calm one when macro data were in question, however, the higher volatility was induced by fundamentals, related to the narrative regarding trade tariffs. The eurusd currency pair was traded between levels of 1,1166 up to 1,1365. The RSI ended the week at the level of 58, but set the path toward the higher grounds, eyeing the overbought market side. The MA50 continues to diverge from MA200, indicating that the potential cross is not in the store for some time in the future.
Current charts are pointing toward the relatively weaker short term resistance level at 1,1380. In case that this level is breached to the upside in the week ahead, then the eurusd will head toward the 1,1480 which is the historical resistance line for the eurusd pair. In this scenario, it would mark a double top formation in technical analysis from which short term reversal could be expected. The second option is that the market starts weekly trading in a more relaxed mode, and revert from current levels. In this case, the next stop of the currency pair will be around the level of 1,1280. Still, it should be considered that the narrative around tariffs on EU goods will continue in a week ahead, which will bring some higher volatility and the PCE data are set for release which could be another trigger for volatility.
Important news to watch during the week ahead are:
EUR: GfK Consumer Confidence in June for Germany, Unemployment rate in in Germany in May, Retail Sales in April in Germany, Inflation rate preliminary for May in Germany,
USD: Durable Goods Orders in April, CB Consumer Confidence in May, FOMC Meeting Minutes, GDP Growth rate for Q1, second estimate, PCE Price Index in April, University of Michigan Consumer Sentiment final for May.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.