Will the euro, which has been trading firm since the ECB announcement, continue to rise over the weekend? Caution is advised.
16.12.2022
- U.S. Daily: Remarks by the President of the San Francisco Federal Reserve Bank
- U.S. Manufacturing/Services PMI
In the U.S. currency market yesterday, the U.S. dollar emerged as the strongest currency, even though the U.S. November retail sales figures released yesterday came in at -0.6% month-over-month—worse than the market forecast of -0.1%.The euro fell against the dollar from 1.0736 to 1.0591, breaking below the 75-period moving average (MA) on the hourly chart. However, the 20-period MA continues to act as support on the hourly chart, and with the pair attempting to rebound during today’s Asian session, we should remain cautious as to whether the U.S. dollar’s strength will hold through the final trading day of the week.
Among European currencies, the euro—following yesterday’s ECB policy rate announcement, in which the policy rate was raised from 2.0% to 2.5%—gained ground alongside the U.S. dollar.Similarly, following the Bank of England’s (BOE) policy rate announcement—which resulted in a 0.5-point rate hike—the euro gained ground against the pound, with the EUR/GBP pair rising from 0.8594 to 0.8729.From a technical perspective, while the RSI on the 4-hour chart has exceeded 70 and stands at 77.8, the RSI on the daily chart has not yet reached 70 and still has room to rise; therefore, it will be worth watching whether the euro continues to strengthen against the pound.
Today’s economic indicators include UK Retail Sales at 16:00, French Manufacturing/Services PMI at 17:15, German Manufacturing/Services PMI at 17:30, Eurozone Manufacturing/Services PMI at 18:00, UKManufacturing/Services PMI at 17:30, the Eurozone Consumer Price Index at 19:00, the Turkish Housing Price Index at 20:30, Canadian Wholesale Sales at 22:30, the U.S. Manufacturing/Services PMI at 23:45, and at 26:00, a speech by the President of theRemarks by the President of the San Francisco Fed are scheduled. We’ll be watching carefully to see if the euro, which has been firming since the ECB announcement, will extend its gains over the weekend.
Author: Keisuke Sakurai
