Global macro overview for 25/01/2017:
The Ifo Business Climate Index data prepared by the Ifo Institute for Economic Research in Munich was just released. The data was worse than market participants expected. The main index, Ifo Business Climate, came at the level of 109.8, while market participants expected a slight increase to 111.3 from 111.0 a month ago. Moreover, the bigger disappointment was Ifo Expectation data, because it worsened to 103.2 from 105.5 a month ago (105.8 was the expected number). The comments from the Ifo Institute mainly concerned the recent beginning of Trump's presidency. The Ifo said nothing has yet been decided on Trump's protectionist rhetoric, so German firms are waiting for actions from Trump, not just words, so no Trump effect has been seen in the Ifo sentiment index. Moreover, Ifo confirmed German GDP forecast of 1.5% for 2017. In conclusion, Germany ramains unaffected by Trump's presidency so far, but all Germany needs to do is wait now.
Let's now take a look at the EUR/USD technical picture in the 4H time frame. The intraday support at the level of 1.0719 had been tested and the market bounced slightly. Currently, the price is trading around the level of 1.0742 (weekly pivot resistance) and it is likely to head towards the next intraday resistance at the level of 1.0772. A breakout above this level will open the road towards the next technical resistance at the level of 1.0874.
