The Euro put in an impressive week versus both the dollar and the Swiss franc with both pairs approaching short term targets.
The EUR/USD has made a close above 1.3500 and now may target the 61.8% Fibonacci retracement level from the November to January move. This level coincides with the resistance level from October at 1.3740.
The EUR/CHF completed a bottom head and shoulders reversal pattern and has reached its estimated target at 1.3030, which coincides with the 50% retracement from the mid-November to January move. The 100-day moving average now comes into play which is currently close to the falling trend line off of the November highs at 1.3140.
EUR – German Flash Manufacturing PMI – 08:30 GMT
Expectations: 61.1. Previous: 60.7
EUR – Industrial New Orders – 10:30 GMT
Expectations: 2.3%. Previous: 1.4%.
Germany, the engine of EU growth, appears be to coming out of the recession with the Bundesbank increasing its economic forecast, raising 2011 expectations to 2.3% from 1.8%. Euro strength will likely be seen if these two industrial reports come in above market expectations.