FORCVAST FOR EURUSD 16-20 FEB

EUR/USD traded in a narrow range for long periods, a feat unseen for a long time, but eventually made a nice move higher. Greece remains in the limelight, but we also have the first ECB meeting minutes, PMIs and other events to move the common currency. Here is an outlook for the highlights of this week and an updated technical analysis for EUR/USD.

Greece was left, front and center. Tough rhetoric was heard from both sides around the Eurogroup meeting. Greece seems to be willing to compromise on some aspects but still wants a change in debt repayment. Germany seems willing only to change the word “troika” but offers a tough stance. This might change after elections in Hamburg. Data continued beating expectations, with strong German growth standing out. Is the weaker euro already bearing fruit? In the US, the strength that followed the NFP faded when both retail sales and consumer confidence disappointed.

Technical lines from top to bottom:

The post crisis low of 1.1867, should be watched. 1.1750 was a low point the pair reached in a breakdown in early January 2015. The round number of 1.17 was the launch value of the pair in 1999 and has a symbolic meaning.

Below, we have the post Swiss bounce of 1.1650 which worked as resistance. Lower, 1.1540 provided support in mid January.

Below the round number of 1.15 we have the pre-QE low of 1.1460 that could work as resistance.

1.1373 was the low line seen in November 2003 and proved to work as resistance and support lately. Below the initial low point of 1.1313 we have 1.1270, which provided support twice in February 2015.

The round number of 1.12 is now the pivotal line in the range. It is followed by the fresh low of 1.1113 which is nearly 0.90 on USD/EUR.

The next line is the round 1.10. It is followed by 1.0760, which was the low point in both July and August 2003.

Below this point we have the round numbers of 1.05 and 1 – EUR/USD parity, which is already eyed by some analysts.

I am bullish on EUR/USD