Will the euro, which has been firming since the ECB announcement, rise further 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 yesterday’s U.S. currency markets, the U.S. dollar emerged as the strongest currency despite the fact that 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 EUR/USD pair fell 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 the pair is attempting to rise during today’s Asian session. Therefore, we should remain cautious regarding whether the US dollar’s strength will hold through the final trading day of the week.
European currencies strengthened alongside the U.S. dollar after the ECB announced its policy rate decision yesterday, raising the rate from 2.0% to 2.5%. The euro outperformed the pound, which saw a 0.5 percentage point rate hike following the BOE’s announcement, with the EUR/GBP pair rising from 0.8594 to 0.8729.Technically, 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, leaving room for further movement. Therefore, it will be worth watching whether the euro continues to strengthen against the pound.
Today’s economic indicators include UK Retail Sales at 4:00 PM, France Manufacturing/Services PMI at 5:15 PM, Germany Manufacturing/Services PMI at 5:30 PM, Eurozone Manufacturing/Services PMI at 6:00 PM, UKmanufacturing/services PMI, 19:00 for the Eurozone Consumer Price Index, 20:30 for Turkey’s Housing Price Index, 22:30 for Canada’s Wholesale Sales, 23:45 for the U.S. manufacturing/services PMI, and 02:00 for the U.S. Daily: Remarks by the President of the San Francisco Fed.We will carefully assess whether the euro, which has been firming since the ECB announcement, will extend its gains over the weekend.
Author: Keisuke Sakurai
