Without any economic data on tap, the euro managed to finish yesterday’s trading in the green against the US dollar. EURUSD traded higher to 1.1173 after opening at 1.1142. However, the currency pair reversed its gains during the New York session and closed at 1.1148.
Trade Data from Europe Top Forecasts
Italy’s trade balance for October came in better than expected yesterday at 8.06 billion EUR. The forecast was only at 2.82 billion EUR. Meanwhile, the euro zone-wide report showed that the value of exported goods was 24.5 billion EUR more than what it imported. Market analysts only estimated a 19.7 billion EUR trade surplus.
However, it’s worth noting that EURUSD is currently trading lower in today’s Asian session. The currency pair is down roughly 14 pips from its opening price at 1.1147.
ECB President Lagarde Speaks Today
For today, ECB President Lagarde is scheduled to make a speech at 8:30 am GMT. If she expresses optimism or that the ECB is unlikely to resort to further easing, the euro could extend its gains in today’s trading.
German Ifo and Inflation Data on Tap
At 9:00 am GMT, the German Ifo Business Climate report for December is scheduled for release. It is anticipated to show a slight improvement in confidence among executives. The forecast higher at 95.6 than the November reading at 95.0.
EU and US Trade Negotiations in Focus
Market participants will also be keeping an ear out for updates on trade negotiations between the EU and the US. Remember that US President Donald Trump had intended to put tariffs on EU-made cars. While the deadline for making a decision on these tariffs have been extended, news that hint at a possible deal could be bullish for the euro.
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EURUSD Outlook
EURUSD is currently testing support at the rising trend line (from connecting the higher lows of November 29, December 9, December 11, December 13, and December 17). If today’s candlestick closes below the trend line, we could see EURUSD fall to its December 11 low at 1.1080 and test it for support.
On the other hand, hammer or a doji at the trend line could mean that the currency pair may soon trade higher to resistance around its December 13 highs at 1.1180.
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