EUR/USD temporarily held before US consumer confidence data

Eurozone - German Ifo Business Climate Index,

Today at 09:00 GMT, the Ifo Institute for Economic Research is publishing the German Business Climate This Month Index. The Ifo Business Climate Index measures the level of a composite index, which was created by surveying around 7,000 companies in Germany when they were asked to rate business conditions and comparing the situation now and six months ago.

Since the survey has a large sample size compared to similar studies, binary options investors view the Ifo Business Climate Index as a strong leading indicator of overall economic optimism in the country. Last month, Germany's Ifo Business Climate came in at 108.7, and this month, Forecasts are set slightly lower, at 107.7.

USA - CB Consumer Confidence Index

Tomorrow, at 3:00 pm GMT, the company's board will publish an index of consumer confidence that measures the level of a composite index that was created from data based on a regular monthly household survey. A higher consumer confidence index usually indicates future consumer spending, which can have a significant impact on economic conditions in general. Thus, binary options traders view this type of indicator survey as a leading indicator. Last month, the consumer confidence index came in at 98.0. This month, expectations come in and indicate that the index reading will be slightly lower at 95.6.

Trading recommendations for the EUR/USD currency pair

EURUSD-25 jul16Since the formation of a large bearish intermediate candle in  May 3, 2016 EUR/USD remains in a strong downtrend, which has pushed the price around 700 pips over the past 3 months, and helped form the well-respected downtrend line in the process. Last week, the EUR/USD started to rebound, but the immediate resistance around 1.1150 proved to be too much for the bulls and the price soon resumed the bearish trend. Last Friday, the price of the EUR/USD currency pair came near the support around the level of 1,0965, it breached it, but failed to close below the support level.

It seems that the bears will be patient about the direction for now as the Consumer Confidence reading is expected to drop  CB  In the US from 98 to 95,6. However, if the data came out better than expectations and the euro/dollar price closed below 1.0965, that would definitely confirm the continuation of the bearish trend.

Under these circumstances, it would be advisable for binary options traders to consider placing a sell order for the EUR/USD currency pair with binary options brokers at the earliest, once the price closes below 1,0965 on the daily chart.

 

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Ahmed A.
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