Will the euro, which has been firming 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 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 rebound during today’s Asian session; therefore, 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—along with the U.S. dollar—gained ground after the ECB announced its policy rate decision yesterday, raising the policy rate from 2.0% to 2.5%.Similarly, following the Bank of England’s 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 and services PMIs at 17:15, German manufacturing and services PMIs at 17:30, Eurozone manufacturing and services PMIs at 18:00, and 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 will carefully assess whether the euro, which has been firming since the ECB announcement, will extend its gains over the weekend.
Author: Keisuke Sakurai
