EUR/USD — The shutdown and consolidation is growing.
The EUR/USD rate falling, but the downward movement is expired.
Wednesday, new strong data on the u.s. economy is released: durable goods Orders were up + 5.1% compared to the forecast for the year.
Excluding transportation, the growth is even higher + 6.1% per year.
«Equipment goods», that is investment. Growth is also strong + 3.6% for the year, and a revision of the previous, with an increase of + 3.6%.
This supported the dollar, but we are seeing a slowdown in the decline of the euro, even in the context of solid data on the dollar.
It is important to understand that the decline of EUR/USD 1.2100 to 1.1750 is so far only a correction to the previous several months of growth.
It is very probable consolidation, the fluctuation of the exchange rate in some of the new range.
A little bit about the american economy: It is clear, by looking at the S & P500 index chart, the main growth is already complete.
However, a reversal and a fall, a crisis in the real sector of the economy is necessary.
Today at 13.30, the third reading of US GDP for the 2nd quarter.
Pay attention to it. Here, there are data on the average of the dynamics of business profitability (business profits). Thus, the average profit growth of + 8.1% for the year.
When the growth of the economy is exhausted, the profit levels will not grow, but in the fall. The result itself is still in growth, its total volume, but the level of profitability is in decline. While we are witnessing the growth.
That is, the u.s. economy is well and growing.
Let us return to the fate of the EUR/USD. I do not think that we have a complete turn of the pair and a further fall to 1.0500 and below. It is more likely that the decline will reach a maximum of 50% of the correction for the growth. It is at 1.1300 about.
But, without a doubt, below 1.1660 and we will not go.