EU 25 New Car Registrations increased in October which followed a string rise in September. Adding to bullish sentiment was the unexpected increase in Italian new industrial orders as well as sales. A bigger than expected current account surplus out of the Eurozone was also released and while the EURUSD maintained its uptrend, price action is pausing at resistance. How will this currency pair react following the release of US economic data? Today’s fundamental analysis will take a look at price action in both directions.
US housing starts and building permits will be the sole US economic report released during the trading session. Economists expected a rebound from last month’s decrease, the US consumer has supported the economy by increasing debt and spending. The housing sector is key to how confident US consumer feel. How will price action in the EURUSD react following the release of this data set? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Here are the key factors to keep in mind today for Euro trades:
- EU 25 New Car Registrations: EU 25 New Car Registrations for October increased by 8.7% monthly. Forex traders can compare this to EU 25 New Car Registrations for September which increased by 14.5% monthly. Italian New Car Registrations for October increased by 10.4% monthly and by 6.7% annualized. Forex traders can compare this to Italian New Car Registrations for September which increased by 59.8% monthly and by 13.4% annualized. German New Car Registrations for October increased by 16.3% monthly and by 12.7% annualized. Forex traders can compare this to German New Car Registrations for September which decreased by 22.0% monthly and which increased by 22.2% annualized. French New Car Registrations for October increased by 9.0% monthly and by 8.7% annualized. Forex traders can compare this to French New Car Registrations for September which increased by 34.2% monthly and by 16.6% annualized.
- Italian Industrial New Orders and Industrial New Sales: Italian Industrial New Orders for September increased by 1.0% monthly and by 0.3% annualized. Economists predicted a decrease of 1.5% monthly and of 3.9% annualized. Forex traders can compare this to Italian Industrial New Orders for August which increased by 0.8% monthly and which decreased by 10.4% annualized. Italian Industrial New Sales for September increased by 0.2% monthly and decreased by 1.6% annualized. Economists predicted a decrease of 0.4% monthly and of 1.0% annualized. Forex traders can compare this to Italian Industrial New Orders for August which decreased by 0.3% monthly and by 2.2% annualized.
- Eurozone Current Account: The Eurozone Current Account (s.a.) for September was reported at €28.2B and the Eurozone Current Account (n.s.a) was reported at €35.8B. Forex traders can compare this to the Eurozone Current Account (s.a.) for August which was reported at €28.5B and to the Eurozone Current Account (n.s.a.) which was reported at €27.6B.
Here is the key factor to keep in mind today for US Dollar trades:
- US Housing Starts and Building Permits: US Housing Starts for October are predicted to increase by 4.9% monthly to 1,318K starts and Building Permits are predicted to decrease by 0.8% monthly to 1,381K permits. Forex traders can compare this to US Housing Starts for September which decreased by 9.4% monthly to 1,256K starts and to Building Permits which decreased by 2.7% monthly to 1,387K permits.
Should price action for the EURUSD remain inside the or breakout above the 1.1055 to 1.1090 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.1065
- Take Profit Zone: 1.1180 – 1.1245
- Stop Loss Level: 1.1015
Should price action for the EURUSD breakdown below 1.1055 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.1015
- Take Profit Zone: 1.0880 – 1.0925
- Stop Loss Level: 1.1055
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