EUR/USD to Remain Bearish amid Forecast of Rising CB Consumer Confidence Index

United States – The Conference Board (CB) Consumer Confidence Index

Tomorrow, at GMT 2:00 p.m., United States based Conference Board Inc. (CB) will release its consumer confidence index, which measures the changes in the level of a composite index by surveying 5,000 households in the United States.

The large sample size (5,000) of the survey makes it one of the most comprehensive research data regarding the consumer spending pattern in the country. Since consumer confidence is correlated with consumer spending, binary options investors pay close attention to the CB consumer confidence index.

Last month, the CB consumer confidence index reading came out at 92.2 and the forecast for February is currently set at 93.9.

Eurozone – German Preliminary Consumer Price Index (CPI)

On Wednesday, the Destatis will release the month-over-month German Preliminary CPI, which measures the change in the price of goods and services bought by German consumers over the past month.

Since the German central bank primarily uses the CPI to measure inflation, it has profound impact on the German economy. Moreover, as the German economy makes up a large portion of the overall Eurozone economic activity, the German CPI also influences the valuation of the Euro against other major currencies. Hence, US binary options traders consider the German Preliminary CPI to be a leading indicator of the Euro.

Last month, the last German preliminary CPI (m/m) indicated that there was a 0.4% increase in price and the forecast for March is that there would have been an additional 0.6% increase in the price level during the past month.

Trade Recommendation for the EUR/USD

EURUSDDaily

EUR/USD bulls had a big day on March 10, when they pushed the price up by around 395 pips and formed a bullish outside bar (BUOB). But, after forming the BUOB bar, the bullish momentum seems to have faded away in vein, as the price subsequently only moved up 125 pips then started a retracement.

Since March 17, the EUR/USD price has fallen by almost 200 pips and finally found adequate support around the 1.1140 level.

As the CB consumer confidence index figure is expected come higher compared to previous month, we believe the fundamental outlook for the EUR/USD will likely remain bearish. However, traders should wait for the price to clear the support level prior to placing any PUT orders with their brokers.

Hence, it would be recommended that binary options traders consider placing a PUT order for the EUR/USD with their binary options brokers once the price closes below the 1.1140 level.

Recommended Broker for US traders: Finpari

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