Should we keep a close eye on the direction of the euro, which has risen despite deteriorating economic sentiment?

Should We Keep a Close Eye on the Euro's Direction Despite Deteriorating Economic Sentiment?

28.06.2024

In U.S. currency trading yesterday, the U.S. dollar weakened during U.S. trading hours despite the fact that the number of new U.S. unemployment insurance claims, released yesterday, fell to 233,000 from 238,000 the previous week, coming in below market expectations. The EUR/USD pair rose from 1.0676 to 1.0727, showing a recovery along the 20-period moving average (MA) on the hourly chart.On the 4-hour chart, the 20-period moving average is acting as support, while on the daily chart, the price is consolidating from below the 10-period moving average.

Despite the slight decline in the Eurozone’s June business sentiment index—which fell from 96.0 in the previous month to 95.9, as announced yesterday—the euro rose against the yen.The euro/yen pair rose from 171.393 to 172.166, moving in line with the 20-period moving average (MA) on the hourly chart. On the 4-hour chart, prices are trading above the 10-period MA. Since the daily chart shows a similar price movement, traders should watch for corrective price movements during European trading hours.

Today’s schedule includes Japan’s employment statistics, Tokyo Consumer Price Index, and industrial production at 8:30 a.m.; UK real GDP at 3:00 p.m.; France’s Consumer Price Index and Producer Price Index at 3:45 p.m.; Switzerland’s KOF Leading Index at 4:00 p.m.; Germany’s employment statistics at 4:55 p.m.; and U.S. Federal Reserve Governor Barkin’s remarks at 7:00 p.m.Richmond Fed President’s remarks, at 9:30 PM: Canada’s Real GDP, U.S. Personal Income, and U.S. PCE Deflator; at 10:45 PM: U.S. Chicago PMI; at 11:00 PM: U.S. University of Michigan Consumer Sentiment Index; and at 1:00 AM: U.S. Fed Governor Bowman’s remarks. We will carefully assess the direction of the euro, which has risen despite deteriorating economic sentiment.