Euro Strengthens Despite Poor German Economic Sentiment
| Action Insight Mid-Day Report 3-21-23 |
Euro Strengthens Despite Poor German Economic Sentiment |
Euro rises broadly today partly as overall sentiment stabilized. Technical also play a role as the common currency defended near term support levels against both Sterling and Aussie. Poor Germany economic sentiment data was basically ignored by the markets. Market participants appeared to dismiss the poor economic sentiment data from Germany, with the belief that the decline could be temporary Simultaneously, Swiss Franc and Dollar are making recoveries against other currencies. Canadian Dollar showed little response to lower-than-anticipated CPI readings, which essentially reinforced BoC's decision to maintain the current interest rate levels, at least for the near future. Other commodity currencies, however, are exhibiting weakness. Australian Dollar, for instance, is facing pressure following the RBA minutes, suggesting a potential pause in their next meeting. Technically, EUR/USD's break of 1.0759 resistance is taken as an indication of near term reversal. That is, further rise is now likely to be seen back to retest 1.1032 high. Two focuses will now be on 1.4780 resistance in EUR/CAD and 1.6200 resistance in EUR/AUD. Break of these two levels should solidify Euro's upside momentum. In Europe, at the time of writing, FTSE is up 1.81%. DAX is up 1.87%. CAC is up 1.82%. Germany 10-year yield is up 0.1525 at 0.273. Earlier in Asia, Hong Kong HSI rose 1.36%. China Shanghai SSE rose 0.64%. Singapore Strait Times rose 1.09%. Japan was on holiday. |
EUR/USD Mid-Day Outlook Daily Pivots: (S1) 1.0660; (P) 1.0696; (R1) 1.0759; More... EUR/USD's break of 1.0759 resistance suggests that correction from 1.1032 has completed at 1.0515 already. That came after defending both 1.0482 support and 38.2% retracement of 0.9534 to 1.1032 at 1.0258. Intraday bias is back on the upside for retesting 1.1032 high next. On the downside, below 1.0703 minor support will turn intraday bias neutral again first. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 21:45 | NZD | Trade Balance (NZD) Feb | -714M | -1800M | -1954M | -2113M | | 00:30 | AUD | RBA Minutes | | 07:00 | CHF | Trade Balance (CHF) Feb | 3.31B | 3.45B | 5.08B | 4.85B | | 07:00 | GBP | Public Sector Net Borrowing (GBP) Feb | 15.9B | 10.5B | -6.2B | -9.1B | | 10:00 | EUR | Germany ZEW Economic Sentiment Mar | 13 | 14.9 | 28.1 | | 10:00 | EUR | Germany ZEW Current Situation Mar | -46.5 | -44.3 | -45.1 | | 10:00 | EUR | Eurozone ZEW Economic Sentiment Mar | 10 | 16 | 29.7 | | 12:30 | CAD | CPI M/M Feb | 0.40% | 0.50% | 0.50% | | 12:30 | CAD | CPI Y/Y Feb | 5.20% | 5.40% | 5.90% | | 12:30 | CAD | CPI - Core M/M Feb | 0.30% | 0.10% | | 12:30 | CAD | CPI Median Y/Y Feb | 4.90% | 4.80% | 5.00% | | 12:30 | CAD | CPI Trimmed Y/Y Feb | 4.80% | 4.90% | 5.10% | | 12:30 | CAD | CPI Common Y/Y Feb | 6.40% | 6.50% | 6.60% | | 14:00 | USD | Existing Home Sales Feb | 4.17M | 4.00M |
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