German ZEW Survey Overview
The ZEW will release its German Economic Sentiment Index and the Current Situation Index at 1000 GMT in the EU session later today, reflecting institutional investors’ opinions for the next six months.
The headline economic sentiment index is expected to fall to -18.4 in January as against an unexpected recovery to -17.5 in the previous month. Meanwhile, the current situation sub-index is also likely to decelerate further to 43.5 versus 45.3 recorded in December.
How could affect EUR/USD?
A surprisingly positive headline reading might prompt some short-covering bounce and assist the pair to make a fresh attempt towards reclaiming the 1.1400 handle. However, a bigger-than-expected drop would further dent the already weaker sentiment surrounding the shared currency and pave the way for an extension of the pair's near-term bearish trajectory.
FXStreet´s own Analyst, Yohay Elam writes: "Initial support awaits at 1.1345 which is the fresh low and also the low point around Christmas. 1.1310 was the swing low at the wake of the new year. Further down, 1.1270 is a double bottom after halting the falls in December. 1.1215 is the 2018 low."
"Looking up, 1.1380 was the initial low after the pair lost 1.1400. 1.1410 is significant resistance after rejecting recovery attempts. This price also coincides with the 200 SMA. 1.1450 served as support early in January. 1.1480 was a swing high before the recent falls," Yohay adds.
Key Notes
• Germany: Focus on ZEW figures today – TDS
• EUR/USD Forecast: Looks to confirm a bearish breakdown ahead of Thursday's ECB decision
• EUR/USD Technical Analysis: Scope for extra downside. Target remains at 1.1300 and below
About German ZEW
The Economic Sentiment published by the Zentrum für Europäische Wirtschaftsforschung measures the institutional investor sentiment, reflecting the difference between the share of investors that are optimistic and the share of analysts that are pessimistic. Generally speaking, an optimistic view is considered as positive (or bullish) for the EUR, whereas a pessimistic view is considered as negative (or bearish).
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