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EUR/USD – Limited market reaction to Syria strikes – Analysis for April 16th 2018

The EUR/USD pair stayed in consolidation mode after an initial drop on Friday and managed to keep itself in the current range. Although the rocket attack carried out by the U.S. and coalition partners in Syria did not cause a strong reaction from the markets, the development of the situation will be observed by investors. Support is set at 1.23, resistance at 1.24.

Commentary:

Data published on Friday did not change the EUR / USD pair significantly. The consumer price index in Germany proved to be in line with expectations and gave a result of 0.4% month-on-month and 1.6% year-on-year. In the U.S. we had the release of Univeristy of Michigan consumer sentiment. The reading came below the expectation at 97.8 while 100.4 was expected and the previous release came at 101.4. The pair initially fell, but ultimately defended the current support level.

The greenback slightly dropped this morning with the dollar index fell by 0.05% to 89.724. The United States, France and the United Kingdom launched a missile attack on Saturday targeting what the Pentagon said were chemical weapons facilities in Syria. Vladimir Putin warned on Sunday that further attacks on Syria could cause ‘global chaos’. The tension also increased after Washington introduced new sanctions against Russia. Although the markets have taken these events quite calmly, the escalation of the conflict may negatively affect the dollar.

Today’s releases:

  • 14:30 USA – Advance retail sales

Analysis:

Pic.1. EUR/USD chart.

The EUR/USD pair stays in consolidation in its current range, sitting at 1.223 at the time of writing. The economic calendar for today is nearly empty, with the release of advance retail sales in the U.S. being the only reading that may influence the pair.

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