Source: PaxForex Premium Analytics Portal, Fundamental Insight
The Preliminary Spanish CPI for April is predicted to rise by 3.4% annualized. Forex traders can compare this to the Spanish CPI for March, which increased by 3.2% annualized.
Eurozone Economic Sentiment for April is predicted at 96.9. Forex traders can compare this to Eurozone Economic Sentiment for March, reported at 96.3. Eurozone Industrial Sentiment for April is predicted at -8.5, and Eurozone Services Sentiment at 6.5. Forex traders can compare this to Eurozone Industrial Sentiment for March, reported at -8.8, and Eurozone Services Sentiment at 6.3. Final Eurozone Consumer Confidence for April is predicted at -14.7. Forex traders can compare this to the previous Eurozone Consumer Confidence for April, reported at -14.9.
The Preliminary German CPI for April is predicted to increase by 0.6% monthly and 2.3% annualized. Forex traders can compare this to the German CPI for March, which rose by 0.4% monthly and 2.2% annualized. The EU Harmonized German CPI for April is predicted to expand by 0.6% monthly and 2.3% annualized. Forex traders can compare this to the EU Harmonized German CPI for March, which accelerated by 0.6% monthly and 2.3% annualized.
The new trading week starts with fresh inflation data from Europe, which could remind traders that the inflationary trend is moving in the wrong direction. Economic data may contradict earnings seasons, which temporarily boosted investor confidence and caused a counter-trend rally. Last week was the best week for equities, following the worst week in years, after three bearish weeks, leaving indices in the red over the past month.
The forecast for the Euro STOXX 50 is cautiously bearish, with this equity index trading at its horizontal resistance area. The Tenkan-sen and the Kijun-sen have flatlined after completing a bearish crossover, suggesting a lack of short-term bullish momentum. The Ichimoku Kinko Hyo Cloud started to narrow, providing traders with a longer-term bearish signal, as the Senkou Span A is moving lower and the Senkou Span B moves higher. Traders should also monitor the CCI after spiking from extreme oversold territory into extreme overbought conditions in seven trading sessions, pointing to more volatility ahead. This technical indicator may move moderately higher before reversing, and a breakdown below 100 could trigger the next sell-off. Can bears regain control over the Euro STOXX 50 and force price action into its horizontal support area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the Euro STOXX 50 Index remain inside the or breakdown below the 4,990 to 5,070 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 5.035
- Take Profit Zone: 4.750 – 4,825
- Stop Loss Level: 5.120
Should price action for the Euro STOXX 50 Index breakout above 5,070, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 5.120
- Take Profit Zone: 5.215 – 5.25
- Stop Loss Level: 5.070
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