The Euro / Dollar currency pair for the last trading day showed a high volatility of 82 points. As a result, the price returned to the limits of the range level. From the point of view of technical analysis, we have a return to the range level of 1.1280 / 1.1300, in an attempt to resume the downward movement. However, we received a temporary run, and after which, the quote quickly rolled back to the range. The blame for this fluctuation is put forth on the informational and news background. In a more precise basis, we have to rely on yesterday's statistics. We will begin with Europe, where such an important indicator was published as industrial production data. No one waited for a miracle to happen, everyone knew that the indicators would be even worse: Prev. -3.0% ---> Prog. -3.2%, the result turned out worse than expected, -4.2%. As predicted, this circumstance terrified the euro, and thus, it encountered a decline. In the afternoon, everyone waited for the release of the key news regarding inflation in the United States. Experts predicted a decline from 1.9% to 1.5%, which would clearly contribute to the recovery of the euro after the recent decline. Inflation comes in at 1.6% instead of 1.5%, and this one tenth was enough to give sellers enthusiasm to further reduce. Returning to the information background, we have another rumor regarding the Brexit agreement. This time, an ITV journalist overheard a conversation with Brexit's leading adviser Theresa May on Olli Robbins at a bar in Brussels. The essence of the overheard was that Prime Minister Theresa May specifically pulls with the date of the vote. The current situation would frighten his associates in the Conservative Party which cannot postpone or force them to accept the current agreement as it is. In turn, the Prime Minister of the Netherlands Mark Rutte stated that it's difficult to estimate the consequences of the Brexit agreement for his country. According to him, the authorities only focus on the benefits--since large companies are moving their offices and personnel from Britain to the country.
Today, in terms of the economic calendar , we are waiting for a considerable amount of data. GDP data in Europe is about approximately 4 square meters. The slowdown in economic growth from 1.6% to 1.2% can be confirmed with last year's data. The retail sales and producer prices statistics were already published in the United States. Prerequisites should also be followed in order to have a stronger dollar.
US 16:30 Moscow time - Producer Price Index (PPI) (YoY) (Jan): Prev. 2.5% ---> Forecast 2.1%
US 16:30 MSK - Retail Sales (YoY): Prev. 4.2% ---> Forecast 4.5%
Further development
Analyzing the current trading chart, we see that the price is clearly trying to fix below the range level of 1.1280 / 1.1300, but still forms a kind of slowdown. It is likely to assume that if the quotation succeeds in getting lower than 1.1240 and the news background in this case is favorable, a further decline to 1.1214 should not be ruled out. Otherwise, stagnation may turn into an amplitude oscillation of 1.1260 / 1.1330.
Based on the available data, it is possible to decompose a number of variations, let's consider them:
- We consider buy positions in case of recovery of the upward move and price fixing higher than 1.1350.
- We consider selling positions in the case of price fixing lower than 1.1240, with a perspective of 1.1214 (the first point).
Indicator Analysis
Analyzing a different sector of timeframes (TF ), we see that in the short, intraday and medium term showed a downward interest on the general background of the market.
Weekly volatility / Measurement of volatility: Month; Quarter; Year
Measurement of volatility reflects the average daily fluctuation , with the calculation for the Month / Quarter / Year.
(February 14 was based on the time of publication of the article)
The current time volatility is 45 points. If the downward move continues and the conditional range level is considered to be broken, we will see an increase in volatility. Otherwise, if there is a cyclical move within the range level, the volatility will remain at current values.
Key levels
Zones of resistance: 1.1300 **; 1.1350 *; 1.1440; 1.1550; 1.1650 *; 1.1720 **; 1.1850 **; 1.2100
Support areas: 1.1300 **; 1.1214 **; 1.1120; 1.1000
* Periodic level
** Range Level