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On Tuesday, US macroeconomic indicators came out generally positive, but the momentum of the market and speculative optimism allowed the euro as close as possible to the lower limit of the range 1.1750-1.1822. The consumer confidence index from the Conference Board for August increased from 127.9 (revised to increase from 127.4) to 133.4. Wholesale stocks for July increased by 0.7% against expectations of 0.1%. Business activity in Richmond this month rose from 20 to 24 against expectations of a decline to 18. The US trade balance for July came in worse than expected at -72.2 billion dollars against -68.6 billion. Also, the house price index reduced the rate from 6.5% YoY to 6.3% YoY. Stock indices showed weak growth.
On the daily chart, the price was fixed above the indicator line of the balance sheet, formally the euro could rise higher enough, but it causes concern for the formation of such condition immediately before a strong technical range. In case of a rapid growth, we would have no doubt that the range of 1.1750-1.1822 can be overcome, but the market uncertainty allowed the Marlin oscillator signal line on the four-hour chart to go under the supporting trend line, this is the first signal that Marlin can go into a negative zone, indicating the depletion of the market.
The signal level at 1.1623 determines the further decline in the price, from which it unfolded thrice since the end of July. At the same time, the balance line can be overcome both on the 4-hour chart and on the daily timeframe, and the daily support of the balance line is already at the 1.1655 level. But while waiting for this to happen, we anticipates for one more attempt of the euro to attack the technical range above it.Today, the main event will be the publication of the revised US GDP for the second quarter, with a forecast of 4.0% against 4.1% in the first assessment. The figure is considered strong even if it is lower than the initial estimate. And, it is possible that today's release may be even better than the forecast, since Atlanta's FRB declared an estimate of 4.6% for the third quarter. In this case, the development of a negative scenario for the euro can be realized completely, the goal is to support the trend line at 1.1532 in the future for several days. Tomorrow, the data on personal expenses of consumers for July is expected, with a forecast of -0.4%.
* The presented market analysis is informative and does not constitute a guide to the transaction.
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