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16.04.202405:13 Forex Analysis & Reviews: Forecast for EUR/USD on April 16, 2024

EUR/USD

Yesterday, the US retail sales data fueled the dollar's strength. Retail sales rose a seasonally adjusted 0.7% in March against a forecast of 0.4%, and the February figure was revised upward to 0.9%. The Atlanta Federal Reserve upgraded its estimate for the annualized rate in first quarter GDP growth from 2.4% to 2.8%. There is even talk that the Fed may not lower interest rates at all this year. The dollar rose by 0.24%, while the S&P 500, unable to withstand pressure, declined by 1.20%. In our opinion, this became the main event of the day, demonstrating a clear flight of investors from risk. However, bond yields increased, but this is temporary – today, the Treasury is issuing $46 billion in annual bills, tomorrow $13 billion in 20-year bonds, and the day after tomorrow $23 billion in 5-year bonds, so institutional investors will become even more averse to risk. Moreover, the US Treasury is launching Operation Twist, an operation that has not been announced directly - shifting short-term debt into long-term debt, as it was in the post-crisis period, since 2011. The problem is that such operations increase inflation, which means that there's a serious basis for the assumption that the Fed will only lower the rate next year.

Exchange Rates 16.04.2024 analysis

So, the EUR/USD pair has settled below the range of 1.0636/56 and is approaching the target level of 1.0567. Overcoming this level opens up the target of 1.0520. The signal line of the Marlin oscillator on the daily chart has left its own descending channel by moving downwards and is preparing to enter the oversold zone. Perhaps a correction will start from the level of 1.0520.

Exchange Rates 16.04.2024 analysis

On the 4-hour chart, the price is steadily declining below the indicator lines, while the Marlin oscillator is rising contrary to the quotes. The price will likely take a break until the evening, ahead of the release of US data. Housing starts in March are expected to edge down, but industrial production may increase by 0.4%. Overall, the forecasts are optimistic, and we expect the euro to find support at the nearest level of 1.0567.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Laurie Bailey,
Analytical expert of InstaSpot
© 2007-2024
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