Published on May 17, 2023

Daily Analysis For EUR/USD 17-05-2023

EUR/USD Analysis

Economic Events and Scenario for EUR/USD

Economic Events: -

GMT	Event	Impact	Currency
00:00	(United States) Fed Bostic Speech	Medium	USD
00:50	(Japan) GDP Price Index YoY	Low	JPY
00:50	(Japan) GDP Capital Expenditure QoQ	Low	JPY
00:50	(Japan) GDP External Demand QoQ	Low	JPY
00:50	(Japan) GDP Private Consumption QoQ	Low	JPY
00:50	(Japan) GDP Growth Rate QoQ	High	JPY
00:50	(Japan) GDP Growth Annualized	High	JPY
02:30	(Australia) Wage Price Index QoQ	Low	AUD
02:30	(Australia) Wage Price Index YoY	Low	AUD
02:30	(China) House Price Index YoY	Medium	CNY
04:35	(Japan) 20-Year JGB Auction	Low	JPY
05:30	(Japan) Capacity Utilization MoM	Low	JPY
05:30	(Japan) Industrial Production MoM	Low	JPY
05:30	(Japan) Industrial Production YoY	Low	JPY
05:30	(Netherlands) Unemployment Rate	Medium	EUR
06:30	(France) Unemployment Rate	Medium	EUR
07:00	(European Union) New Car Registrations YoY	Medium	EUR
08:00	(China) FDI (YTD) YoY	Medium	CNY
08:00	(Austria) Harmonised Inflation Rate YoY	Low	EUR
08:00	(Austria) Harmonised Inflation Rate MoM	Low	EUR
08:00	(Austria) Inflation Rate MoM	Low	EUR
08:00	(Austria) Inflation Rate YoY	Low	EUR
08:00	(Austria) CPI	High	EUR
08:00	(Slovakia) Harmonised Inflation Rate YoY	Low	EUR
08:00	(Slovakia) Harmonised Inflation Rate MoM	Low	EUR
09:00	(Italy) Balance of Trade	Medium	EUR
10:00	(Cyprus) Harmonised Inflation Rate YoY	Low	EUR
10:00	(Euro Area) Inflation Rate MoM	Low	EUR
10:00	(Euro Area) Core Inflation Rate YoY	Low	EUR
10:00	(Euro Area) Inflation Rate YoY	Medium	EUR
10:00	(Euro Area) CPI	High	EUR
10:00	(France) 5-Year OAT Auction	Low	EUR
10:00	(France) 3-Year OAT Auction	Low	EUR
10:00	(Malta) Inflation Rate YoY	Low	EUR
10:00	(Euro Area) ECB Elderson Speech	Low	EUR
10:30	(Germany) 10-Year Bund Auction	Medium	EUR
10:30	(Euro Area) ECB Panetta Speech	Low	EUR
10:50	(United Kingdom) BoE Gov Bailey Speech	Medium	GBP
11:00	(Spain) Consumer Confidence	Medium	EUR
11:00	(Ireland) Residential Property Prices MoM	Low	EUR
11:00	(Ireland) Residential Property Prices YoY	Low	EUR
11:00	(France) 10-Year Index-Linked OAT Auction	Low	EUR
11:00	(Ireland) Balance of Trade	Low	EUR
11:10	(European Union) 3-Month Bill Auction	Low	EUR
11:10	(European Union) 6-Month Bill Auction	Low	EUR
11:30	(United Kingdom) 5-Year Treasury Gilt Auction	Low	GBP
12:00	(United States) MBA 30-Year Mortgage Rate	Medium	USD
12:00	(United States) MBA Mortgage Applications	Low	USD
12:00	(United States) MBA Mortgage Refinance Index	Low	USD
12:00	(United States) MBA Mortgage Market Index	Low	USD
12:00	(United States) MBA Purchase Index	Low	USD
13:30	(Canada) New Motor Vehicle Sales	Low	CAD
13:30	(Canada) Foreign Securities Purchases by Canadians	Low	CAD
13:30	(Canada) Foreign Securities Purchases	Low	CAD
13:30	(United States) Building Permits MoM	Medium	USD
13:30	(United States) Housing Starts MoM	Medium	USD
13:30	(United States) Housing Starts	Medium	USD
13:30	(United States) Building Permits	High	USD
15:30	(United States) EIA Refinery Crude Runs Change	Low	USD
15:30	(United States) EIA Crude Oil Stocks Change	Medium	USD
15:30	(United States) EIA Distillate Stocks Change	Low	USD
15:30	(United States) EIA Heating Oil Stocks Change	Low	USD
15:30	(United States) EIA Gasoline Production Change	Low	USD
15:30	(United States) EIA Crude Oil Imports Change	Low	USD
15:30	(United States) EIA Gasoline Stocks Change	Medium	USD
15:30	(United States) EIA Cushing Crude Oil Stocks Change	Low	USD
15:30	(United States) EIA Distillate Fuel Production Change	Low	USD
16:15	(Euro Area) ECB Guindos Speech	High	EUR
16:30	(United States) 17-Week Bill Auction	Low	USD
17:00	(Canada) 3-Year Bond Auction	Low	CAD
18:00	(United States) 20-Year Bond Auction	Low	USD
23:45	(New Zealand) PPI Input QoQ	Low	NZD
23:45	(New Zealand) PPI Output QoQ	Low	NZD

Today's Scenario: - EUR/USD is experiencing slight gains near 1.0870, recovering from the losses of the previous day during the early hours of Wednesday in Europe. However, the Euro pair is struggling to fully embrace the market's cautious optimism regarding the extension of the US debt ceiling, given the limited economic calendar and mixed signals.

Nevertheless, there is renewed hope in the market due to a meeting between US President Joe Biden, House Speaker, and a prominent congressional Republican, Kevin McCarthy. This has instilled optimism among market participants that US policymakers will find a solution to avoid a potentially disastrous default. After a meeting that lasted less than an hour, congressional leaders expressed their belief that a deal could be reached by the end of the week.

Buy Scenario: - Conversely, the lower boundary of the aforementioned channel, around 1.0885, currently acts as a resistance level for any immediate recovery in the EUR/USD pair.

Subsequently, the 100-Hour Moving Average (HMA) and a descending trend line, which has been in place for two weeks, near 1.0900 and 1.0925 respectively, may attract buyers.

It is worth noting that a horizontal zone consisting of multiple levels established since May 2, as well as the 200-HMA around 1.0935-1.0945 and 1.0950 respectively, serve as the final defense for bearish movements in EUR/USD, till we do not advise to buy EUR/USD currency pair.

Sell Scenario: - During the early Asian session on Wednesday, EUR/USD remains at lower levels near 1.0860 after reversing its rebound from the start of the week on Tuesday.

This decline confirms the breach of a bullish channel that had been forming throughout the week, as well as the bearish signals from the MACD indicator. However, the relative strength index (RSI) suggests that the pair is nearing oversold conditions.

In addition to the RSI indicating limited downward potential for EUR/USD, there are multiple support levels around 1.0837-1.0845 that have been established since April 10, posing a challenge for bearish sentiment.

Therefore, if sellers fail to push the pair below the immediate support level mentioned, they might retreat, with the previous monthly low around 1.0785 becoming the next target. The psychological level of 1.0800 could provide an intermediate pause in the potential downward movement. Till then we do not advise selling EUR/USD.

Support and Resistance Level: -