Release Time:2018-10-15 02:02
EURUSD (1.1576) • German CPI data was unchanged from the preliminary report (+2.3% Y/Y) for Sep. Eurozone Industrial Production data reflected much stronger than expected output for Aug (+1.0% M/M versus +0.5% expected). EURUSD is little changed from thursday but appears to be heading for a modest gain on the week to consolidate losses seen over the past couple of weeks. Bund/BTP spreads are steady around 300bps, helping underpin the EUR as Italian budget concerns stabilize. Sovereign ratings action in response to the Italian government’s fiscal stance remains a risk, however. EURUSD short-term technicals: neutral/bearish – Short-term chart patterns suggest the EUR rally may be running out of steam in the low 1.16s. Intraday price action is looking a little heavy and putting short-term bull trend support (1.1580) under a little pressure as American trade picks up. We see resistance at 1.1617 (40-day MA) as key near-term. A push through here would allow EURUSD to push on to the low 1.17s near-term. Weakness below 1.1580 this morning seems a more obvious risk, however, which could see the EUR slide back to 1.1530. Trend signals are generally weak on the short-term oscillators, favouring range trading we feel.