Euro and Pound Struggle Amid Energy Price Shock and US Trade Threats
| Action Insight Daily Report 1-3-25 |
Euro and Pound Struggle Amid Energy Price Shock and US Trade Threats |
European currencies remain on the defensive as the new trading year unfolds, with Euro struggling near its lowest level against Dollar since 2022 and Sterling hovering close to a nine-month low. Dollar, while firm, is holding steady in narrow ranges against Yen and commodity-linked currencies, with traders awaiting fresh signals from today’s ISM Manufacturing PMI. Europe’s economic outlook has been further clouded by an energy price surge. This week, Russian natural gas flows to the EU via Ukraine ceased after the expiration of a five-year transit agreement, forcing European nations to seek pricier LNG imports elsewhere. This development adds another layer of strain to energy-reliant economies like Germany, France, and the UK, worsening their already fragile terms of trade. US natural gas futures reflected the energy market's unease, spiking to 4.474 earlier this week before retreating. Key resistance now stands at the 38.2% retracement of 10.03 to 1.570 at 4.870. Strong resistance is expected to cap further gains for now, setting the stage for medium-term range trading above 3.024 resistance turned support. However, decisive break above 4.870 could signal significant shifts in energy market dynamics, and could prompt panic rally towards 61.8% retracement at 6.798.... |
EUR/USD Daily Outlook Daily Pivots: (S1) 1.0321; (P) 1.0389; (R1) 1.0429; More... Intraday bias in EUR/USD remains on the downside at this point, as fall from 1.1213 is in progress to 1.0199 fibonacci level. Decisive break there will solidify the case of larger bearish trend reversal. Next target will be 61.8% projection of 1.1213 to 1.0330 from 1.0629 at 1.0083. On the upside, above 1.0343 support turned resistance will turn intraday bias neutral first. But outlook will now stay bearish as long as 1.0629 resistance holds, in case of recovery. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
|---|
| 08:55 | EUR | Germany Unemployment Rate Dec | 6.20% | 6.10% | | 08:55 | EUR | Germany Unemployment Change Dec | 15K | 7K | | 09:30 | GBP | Mortgage Approvals Nov | 69K | 68K | | 09:30 | GBP | M4 Money Supply M/M Nov | 0.10% | -0.10% | | 15:00 | USD | ISM Manufacturing PMI Dec | 48.3 | 48.4 | | 15:00 | USD | ISM Manufacturing Prices Paid Dec | 50.5 | 50.3 | | 15:00 | USD | ISM Manufacturing Employment Index Dec | 48.1 | | 15:30 | USD | Natural Gas Storage | -127B | -93B |
|
|
|
