EURUSD is looking for a fourth-consecutive day of gains as the pair now trades at 1.1850. Direction could come from the latest retail sales data from the U.S. economy this afternoon.
Retail sales from the United States are expected to rise by 0.5% compared to last month’s strong reading of 1.9%. The ex auto number is also expected to come in at 0.6% versus 1.5% previously. The consumer is still under strain in the world’s-largest economy and the failure of the recent stimulus talks, coupled with the ongoing virus cases has left many unable to spend beyond their means.
This afternoon will see a speech from ECB Vice-Preisent Luis De Guindos. In his latest talks he has reiterated that the risks to the economy are “tilted to the downside”. He also ruled out Parliamentary talk of cancelling debt. He told Italian TV’s SKY:
“Article 123 of the Treaty says monetary financing by the ECB is forbidden. There is no legal basis for debt cancellation”.
The ECB has bought around 3 trillion euros of public-sector bonds since 2015 in a failed attempt to boost boost growth and inflation. They will not cancel this debt, but they may look at changing the term structure.
Later this afternoon sees U.S. industrial production numbers ahead of the more important European inflation release tomorrow. The latest pricing data from the Eurozone is expected to show a print of 0.2%, which would be unchanged from the previous month.
EURUSD Technical Outlook
EURUSD is trading at 1.1850 after three bullish days and the pair has support to advance towards the 1.1900 resistance. A move above there can target the 1.2000 mark, which capped gains in late-August. The 1.1750 level would mean the bears are back in control. The Investing Cube team is currently available to help all levels of traders with the Forex Trading Course or one-to-one coaching.
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EURUSD Daily Chart
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