The French presidential elections will be the centre of attention this week, with the first round which will take place this Sunday, April 23. The week of trading on the Euro Dollar will, therefore, be essentially punctuated by the polls, between two towers, but the economic calendar will also be events potentiellements influential on the forex, with a program that is more loaded than in recent weeks.
Let’s point out the main events macro economic expected in the United States and Europe this week.
In the United States, the most important events will be consumer confidence (Tuesday 16), durable goods orders (Thursday 14: 30), and the first estimate of GDP, Q1 2017, Friday at 14: 30.
Consumer confidence is expected to decline to 122.9 according to the consensus after 125.6 in the previous month.
Durable goods orders are also expected to decline, to +1.2% after +1.8% in the previous month (+0.4% against +0.5% in durable goods orders main).
Finally, the GDP Q1 preliminary expected annual growth of +1.1% after +2.1% in Q4 2016, with a price index of GDP expected to have fallen to 2% after 2.1%.
The week will also be in charge in Europe, with the ECB meeting on Thursday, which will be particularly sensitive, given that it will be held during the period between the two rounds of the French presidential elections. The market’s expectations are unclear regarding the content of this meeting, but there is little chance that Mario Draghi is too optimistic, at the height of the political risk.
Earlier in the week, Monday at 10am, the forex traders also need to monitor the IFO index of business climate in German. Economists anticipating an increase to 112.5 after 112.3 previously. In more detail, the index of the current situation is expected to have fallen to 119.2 after 119.3, while the expectations index is expected to rise to 106 after 105.7 previously.
Finally, on Friday at 14: 30, it will be necessary to look at the CPI preliminary in the Euro Area for the month of April, expected increase of +1.8% in annual data, after 1.5% the previous month.
Fundamental analysis EUR/USD
Statistics with the US expected to decline and european statistics expected in increase, one could expect strengthening of the pair EUR/USD, on which traders are shown to be optimistic, leaving the pair on high levels on Friday evening despite the prospect of the French presidential elections.
If Marine Le Pen was eliminated in the first round, the rise in EUR/USD should be confirmed, and to be fed during the week by the different stats, if they are found to be favourable to the increase of EUR/USD. However, the polls will remain particularly influential, because the market will have their preference, even after the elimination of The Pen.
If Marine Le Pen goes to the second round, the market’s attention will be more focused on the polls next week, with a response binary in to provide for : Higher if The Pen goes up, down if The Pen down.