Watch for whether the euro’s rebound against the dollar will continue

Watch for whether the euro’s rebound against the dollar will continue

07.02.2024

In yesterday’s U.S. trading session, the Canadian dollar fell against the yen after Canada’s December housing starts data, released yesterday, showed a decline from the previous month’s 3.9% drop to 14.0%. The CAD/JPY pair fell from 109.940 to 109.445.The pair has moved just below the daily 20-day moving average (MA). Technically, CAD/JPY is gradually rising while finding support at the daily 20-day MA, so we will be watching price movements during U.S. trading hours.

European currencies rose as the euro strengthened against the U.S. dollar following yesterday’s release of December retail sales data for the eurozone, which showed a slight improvement year-over-year from the previous month’s 1.1% decline to a 0.8% decline.The EUR/USD pair rose from 1.0722 to 1.0762, breaking above the 20-period moving average on the hourly chart. On the daily chart, the pair has rebounded from the -3σ level of the Bollinger Bands, so we will be watching closely to see if this rebound continues for a while.

Today’s schedule includes Malaysia’s Industrial Production at 1:00 PM, Japan’s Economic Sentiment Index at 2:00 PM, Switzerland’s Employment Statistics at 3:45 PM, Germany’s Industrial Production at 4:00 PM, Thailand’s Policy Rate and Statement at 4:05 PM, France’strade balance at 14:05, Taiwan’s trade balance at 17:00, the U.S. MBA Mortgage Applications Index and Brazil’s retail sales at 21:00, the U.S. trade balance and Canada’s international merchandise trade at 22:30, remarks by Fed Governor Kugler at 25:00, and a U.S. 10-year Treasury auction at 27:00. We should pay attention to whether the rebound in the euro/dollar pair will continue.