As opposed to Wednesday when data on the eurozone and the US was worse than expected, yesterday's data surpassed the expectations. Trade balance in the eurozone in March was 18.7 billion euros vs. forecast for 11.8 billion euros; figures from February were revised upwardly from 12.0 billion euros to 12.7 billion euros. In the US Initial Jobless Claims rebounded to 360K, instead of 332K. However, it was an average level of the year 2007 and it did not have any impact on the market. US Housing starts dropped to from revised to 1.02 million in march to 0.85 million in April (forecast 0.98 million). However, the number of Building permits was better than forecast, 1.02 million vs. 0.94 million. “The longer we in the U.S. remain so far below our 2 percent target, the greater the risk that inflation expectations could fall and real interest rates rise,” Boston Fed President Eric Rosengren said on Monday 16. Low inflation and high unemployment “could lead one to argue that policy has not been sufficiently accommodative,” Rosengren added.
DJIA dropped 0.28% and the euro fell 5 points.
This morning report on Core Machinery orders in Japan in March was revealed, it grew 14.2% vs. 4.2% in February. At 17:55 GMT+4 US Michigan sentiment index in May is issued, forecast 77.9 vs. 76.4 in April. At 18:00 GMT+4 US Leading index in April is released, forecast 0.3% vs. -0.1%. Taking into account the macroeconomic data, we may assume the psychological pressure on the investors will be eliminated and the sideways move will be observed as the result.
Technically, the price is under pressure, on the daily chart leading Marlin oscillator does not show any reverse, on the H4 it is in the negative territory. The price is under strong resistance of Fibonacci extension on the H4. However, if the price manages to break the testing level 1.2889, then it may reach the next level of 1.2954 (the low of April 24). if the price consolidates under the support of trendline on the H4 1.2855, the price may test the support of the trendline on 1.2826 or break it towards 1.2810.
