Global macro overview for 07/02/2017:
An unexpected drop in Industrial Production in Germany to the level of -3.0% m/m (-0.7% y/y) had surprised the market participants this morning. This is the biggest drop since 2009 and it is mainly attributed to the seasonal factors, like cold winter weather and the Christmas season (likely the main reasons for the fall). However, the outlook appears brighter given that data released Monday showed factory orders climbing 5.2 percent in December thanks to demand at home and from elsewhere in the Eurozone — a far better performance than anticipated. In conclusion, no reason to start the panic over the Eurozone powerhouse poor performance as the figures will likely go up again in the spring.
Let's now take a look at the EUR/USD technical picture at the H4 time frame. The bears have managed to break out below the golden trendline support and now the market is trading right at the intraday support at the level of 1.0658. If bearish pressure does not decrease, then the next support is seen at the level of 1.0619 and 1.0578.
