{"id":131213,"date":"2018-08-02T07:14:06","date_gmt":"2018-08-02T11:14:06","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=131213"},"modified":"2018-08-02T07:14:06","modified_gmt":"2018-08-02T11:14:06","slug":"eurusd-correction-to-1-1705-in-the-works","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2018\/08\/eurusd-correction-to-1-1705-in-the-works\/","title":{"rendered":"EURUSD: correction to 1.1705 in the works"},"content":{"rendered":"<div id=\"inves-174438606\" class=\"inves-below-title-posts inves-entity-placement\"><div id =\"posts_date_custom\"><div align=\"left\">August 2, 2018<\/div><hr style=\"border: none; border-bottom: 3px solid black;\">\r\n<\/div><\/div><p><strong>By Gabriel Ojimadu, Alpari<\/strong><\/p>\n<p><strong>Previous:<\/strong><\/p>\n<p>On Wednesday the 1<sup>st<\/sup>\u00a0of August, trading on the euro closed down against the US dollar. The euro\u2019s slide was brought about by growth on the dollar across the board as well as a rise in US10Y bond yields.<\/p>\n<p>Bond yields hit 3% ahead of the conclusion of the Federal Reserve\u2019s two-day meeting as well as in response to the US Treasury announcing plans to raise long-term debt issuance to 78bn USD in this quarter, compared to 73bn USD in the previous quarter.<\/p>\n<p>The Federal Open Market Committee (FOMC) decided to leave interest rates unchanged at 1.75 \u2013 2.00%. This decision matched market expectations. In its statement on monetary policy, the FOMC said that it expects to raise interest rates gradually. The euro closed at 1.1659.<\/p>\n<p><strong>US data:<\/strong><\/p><div id=\"inves-2450695037\" class=\"inves-in-content inves-entity-placement\"><hr style=\"border: 1px solid #ddd;\">\r\n<div id=\"inpost_ads_header\">\r\n<p style=\"font-size:10px; float:left; color:#666;\">Free Reports:<\/p><\/div>\r\n<div id=\"inpost_ads\"> \r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/1ApBOV\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2018\/06\/graph_techs_PD.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t     <a href=\"https:\/\/goo.gl\/1ApBOV\"><b><u>Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p><br><br>\r\n<br>\r\n<br>\r\n<p style=\"font-size:15px; float:left;\"><a href=\"https:\/\/goo.gl\/f3RrHX\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/investmacro.com\/wp-content\/uploads\/2019\/01\/cot_pie_80.png\" align=\"left\" width=\"80\"  height=\"55\"\/><\/a>\r\n\t    <a href=\"https:\/\/goo.gl\/f3RrHX\"><b><u>Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p><br><br>\r\n<\/div>\r\n<hr style=\"border: 1px solid #ddd;\">\r\n<br><\/div>\n<ul class=\"list list_type_disc\">\n<li>ISM manufacturing PMI (Jul): 58.1 (forecast: 59.5, previous: 60.2).<\/li>\n<li>ADP employment change (Jul): 219k (forecast: 186k, previous reading revised from 177k to 181k).<\/li>\n<\/ul>\n<p><strong>Day\u2019s news (GMT+3):<\/strong><\/p>\n<ul class=\"list list_type_disc\">\n<li>11:30 UK: PMI construction (Jul).<\/li>\n<li>12:00 Eurozone: PPI (Jun).<\/li>\n<li>14:00 UK: BoE interest rate decision \u2013 Markets expect the regulator to raise the key rate by 0.25% to 0.75%. Volatility will be high despite the fact that this has already been factored into the price.<\/li>\n<li>14:30 UK: BoE\u2019s Governor Carney speech.<\/li>\n<li>15:30 US: initial jobless claims (27 Jul).<\/li>\n<li>17:00 US: factory orders (Jun).<\/li>\n<\/ul>\n<p><img decoding=\"async\" src=\"https:\/\/alpari.com\/data\/media\/cms\/images\/02.08.18_EURUSD_H1_5b62ab72566b9.png\" alt=\"\" \/><\/p>\n<p align=\"center\">Fig 1. EURUSD hourly chart. Source: TradingView<\/p>\n<p><strong>Current situation:<\/strong><\/p>\n<p>My two-day forecast has worked out. The euro rose to 1.1748, and then over the course of 39 hours, returned to the lower boundary of the range at 1.1650.<\/p>\n<p>In Asia, the euro dropped to 1.1654 against the greenback. In my new forecast, I\u2019m expecting a rebound from the support with a target around the 45<sup>th<\/sup>\u00a0degree. I don\u2019t know what the low will be in the Asian session, but I\u2019ve made my calculation from 1.1650.<\/p>\n<p>I don\u2019t see the euro going any higher than 1.1705, because there\u2019s a risk of dropping to 1.1615. According to the US Trade Representative Robert Lighthizer, on Wednesday, President Trump ordered an increase in tariffs on 200bn USD worth of Chinese goods from 10% to 25%. Most of the euro crosses are trading up, but there\u2019s no guarantee that investors won\u2019t start retreating to the safe haven assets.<\/p>\n<p>Today\u2019s key event is the Bank of England\u2019s interest rate decision and Mark Carney\u2019s subsequent speech. The market is expecting a 25 base point hike to bring the key rate to 0.75%. Volatility is expected to be high, despite the fact that the market has already factored in this rise. No one knows what Carney will say, so keep an eye on the dynamics of the EURGBP pair.<\/p>\n<p>US10Y bond yields are at 3%. There\u2019s a chance they could rise to 3.02%. If they don\u2019t go any higher, we\u2019ll get a downwards correction to 2.98%, which will be good for the single currency. I\u2019m all for an upwards correction today.<\/p>\n<div class=\"s_invisible_yes\">Source: &#8220;<a href=\"https:\/\/alpari.com\/en\/hidden_copyright\/\" rel=\"nofollow\">EURUSD: correction to 1.1705 in the works<\/a>&#8220;<\/div>\n<div><\/div>\n<div><\/div>\n<div><\/div>\n","protected":false},"excerpt":{"rendered":"<p>By Gabriel Ojimadu, Alpari Previous: On Wednesday the 1st\u00a0of August, trading on the euro closed down against the US dollar. The euro\u2019s slide was brought about by growth on the dollar across the board as well as a rise in US10Y bond yields. Bond yields hit 3% ahead of the conclusion of the Federal Reserve\u2019s [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-131213","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/131213","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=131213"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/131213\/revisions"}],"predecessor-version":[{"id":131216,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/131213\/revisions\/131216"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=131213"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=131213"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=131213"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}