U.S. Economic Metrics Are Out, EUR/USD Nearing Robust Support Levels

Last week was a big one in terms of the geopolitical tension between the U.S. and North Korea. Equity valuations were turned upside down while the safe-havens won out big. Today’s positive U.S. economic data will bring opportunity as U.S. equities and the dollar digest the metrics.

We are keeping a close eye on the EUR/USD as it enters a key support area.

Hard Data

Here are a few of the more important US economic metrics from earlier:

Event                                                     Previous         Projected        Actual

Export Price Index (MoM, July)               -0.2%               0.2%                  0.4%

Import Price Index (MoM, July)               -0.2%               0.1%                  0.1%

Retail Sales (MoM, July)                         -0.2%               0.4%                  0.6%

Retail Sales without Autos (MoM, July)   -0.2%              0.3%                  0.5%

As mentioned by my colleague Arslan earlier in the session, last week’s U.S./North Korea tension caused dramatic selling in the S&P500 and DJIA.  However, yesterday’s trade has shown these markets to be resilient. The data this morning is largely positive, meaning more strength is likely during today’s U.S. session.

EUR/USD Key Levels Into Play

The EUR/USD has a made a move towards key support numbers. This week will likely test the validity of our long-term uptrend.

EUR/USD Daily Chart- Still Bullish?

As mentioned in the brief earlier from our leading analyst Skerdian, the EUR/USD has formidable support levels coming into the picture.

The post-data action has brought a few of my key technicals into play as well:

• July/August 38% retracement 1.1680

• Daily 13 day SMA 1.1693

• Last Week’s low of 1.1688

Bottom Line: The EUR/USD’s long-term uptrend is undergoing a challenge. The continued positive metrics from the U.S. economy are testing the EUR/USD and giving us some great long entries.

For the U.S. session, I will be looking for intraday compression on the 30-Minute and 60-Minute charts around the 1.1680-1.1693 area to set up a long play. Keep a close eye on our fx leaders trading signals for trade ideas facing the EUR/USD. 

As always, watch the money management and look for positive reward/risk situations.

ABOUT THE AUTHOR See More

Shain Vernier

US Analyst

Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.

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