By Matthew Anthony, Alpari Analyst
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On Friday the 26th of April, trading on the euro closed up. Market activity was low ahead publication of US GDP figures. The EURUSD pair consolidated within a range of 1.1124 – 1.1147.
The GDP report showed a QoQ rise of 3.2% against expectations of 2.0%. This news pushed the euro down to 1.1111. The decline stopped here, though, as the pair recovered to 1.1174 ahead of the weekend.
While GDP figures significantly exceeded market expectations, personal consumption dropped from 1.8% to 1.3% YoY. This is an important inflation indicator for the Fed. Moreover, markets were already expecting high GDP figures. Buy on expectations, sell of the facts.
Day’s news (GMT+3):
Free Reports:
A reversal model formed over the course of Thursday and Friday. To get a correction to around 1.1230, the market first has to test buyers at around 1.1130. If the bulls are weak, and there aren’t any big players on the market, then the smaller players will start closing their long positions, which will allow the bigger players to buy at lower prices through limit orders. I don’t see the pair rising in the first half of the European session, as the stochastic is in the sell zone and the euro is still in a bearish trend. There’s a resistance waiting at 1.1190.
The centre of attention this week is the FOMC meeting and US jobs report. Interest rates are expected to be kept at their current levels. Following the FOMC meeting, the NFP report may not be of interest to the market.
Source: EURUSD: bulls trying to triggers bears’ stop levels