EU: Medium-term outlook
Updated
Thought I would share outlook on where I think EUR/USD is headed longer term as we are heading into new year with new ECB President.
Fundamental:
EU Growth remains subdued entering Q4 with GDP at 0.2% ( QoQ ) - Retail Sales missing their mark down by 0.6%. - as well as Industrial Production and Factory Orders in Germany continued to fall
The world economy outlook remains sluggish and uncertain. This lowers demand for Euro area goods + services and also affects business sentiment and investment.
Next Thursday Christine Lagarde will make her debut where she should set the course of the ECB for the medium-term. Will EU emerge as a proactive economic stakeholder, pushing through more aggressive monetary and fiscal policies, or a passive bystander?
US GDP Q3 still outperforming other major economies at 2.1%
*Outlook for Global growth remains slow through end of Q2 2020 due to a number of factors; such as demographics, disruptive technology, climate change, Trade relations, etc.
*If/When the US-China and US-EU can manage to work through their trade deals, then business sentiment and uncertainty should ease and allow DXY to drop and EU to rise.
Technical:
Looking at weekly time frame price is struggling at a bearish 20 SMMA ( 1.10600 area ) with 100 and 200 SMMAs well above price, indicating longer term bear trend in tact.
1.09900 is next current Fib target for bears where price should retrace/ consolidate before breaking lower.
1.08150 price area has held fairly well in past and could be target for swing/ position holders to enter long...a break below could waterfall.
Currently in a Falling wedge which could play out as a reversal pattern...reversal won't be valid until price has a break and close above trend line on weekly time frame. Until then, Short til it's not!
Would love to hear your thoughts/ analysis
*Trade at your own risk and have a great year
-Krecioch
Fundamental:
EU Growth remains subdued entering Q4 with GDP at 0.2% ( QoQ ) - Retail Sales missing their mark down by 0.6%. - as well as Industrial Production and Factory Orders in Germany continued to fall
The world economy outlook remains sluggish and uncertain. This lowers demand for Euro area goods + services and also affects business sentiment and investment.
Next Thursday Christine Lagarde will make her debut where she should set the course of the ECB for the medium-term. Will EU emerge as a proactive economic stakeholder, pushing through more aggressive monetary and fiscal policies, or a passive bystander?
US GDP Q3 still outperforming other major economies at 2.1%
*Outlook for Global growth remains slow through end of Q2 2020 due to a number of factors; such as demographics, disruptive technology, climate change, Trade relations, etc.
*If/When the US-China and US-EU can manage to work through their trade deals, then business sentiment and uncertainty should ease and allow DXY to drop and EU to rise.
Technical:
Looking at weekly time frame price is struggling at a bearish 20 SMMA ( 1.10600 area ) with 100 and 200 SMMAs well above price, indicating longer term bear trend in tact.
1.09900 is next current Fib target for bears where price should retrace/ consolidate before breaking lower.
1.08150 price area has held fairly well in past and could be target for swing/ position holders to enter long...a break below could waterfall.
Currently in a Falling wedge which could play out as a reversal pattern...reversal won't be valid until price has a break and close above trend line on weekly time frame. Until then, Short til it's not!
Would love to hear your thoughts/ analysis
*Trade at your own risk and have a great year
-Krecioch
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