EUR/USD could turn to the upside December 30, 2016

The price has increased significantly today and has managed to climb above two importnat resistance levels, remains to see if will have enough directional energy to stay bilize above these levels, could climb much higher in the coming days if the USDX will drop deeper. The EUR/USD has decreased as the USD was punished by the USDX’s impressive drop. The USDX maintains a bullish perspective as long as stays above the 102.54 static support level, could hit this level tomorrow, remains to see how will react, a drop below this level followed by a retest will open the door for more declines, this situation will force the greenback to decrease further versus the other major currencies.
The Euro-zone and the United States data have come in mixed in the yesterday’s trading session, the M3 Money Supply rose by 4.8% in November, exceeding the 4.4% estimate, but also the 4.4% growth from the previous reading period, while the Private Loans have increased by 1.9%, the indicator has come in line with expectations, beating the 1.8% increase from the former reporting period.
On the other hand the USD wasn’t impressed by the US economic data even if the Unemployment Claims have come much better, the Initial Claims have decreased from 275K to 265K in the previous week, even if the economists have forecasted an increase to 277K. Moreover the United States Goods Trade Balance has decreased further, from -61.9B to -65.3B, has come much worse comapred to the -61.5B estimate, while the Prelim Wholesale Inventories rose by 0.9%, more versus the 0.1% estimate, the indicator has increased again after the 0.1% drop from the previous reading period.
The Natural Gas indicator has decreased as well, from -209B to -237B, but I don’t think that had any impact on the EUR/USD price.

EURUSDd-4

The rate has edged higher in the early morning, has reached fresh new highs, but has slipped lower in the last hours, right now is challenging the 1.0521 static resistance, personally I believe that will ignore this obstacle and will close the current week much higher. You can notice that the price has managed to climb again inside the descending pitchfork, signalling that the behavior has changed and we may have a larger increase again. I’ve said in my analysis that we could have a bounce back if the rate wil find support at the sliding dotted line (descending dotted line), has retested this level before has started to make higher lows again. The price has increased aggressively today, but has failed to reach the first upside target from the median line (ML) of the descending pitchfork, was almost to reach the major conflunece area formed at the intersection between the median line (ML) with the minor median line (ml) of the ascending pitchfork.

EURUSDh-3

I’ve drawn an ascending pitchfork to show you better the price movement, the rate has rallied but unfortunately has failed to hit the median line (ml) of the ascending pitchfork, could still approach and reach this level in the coming days if will stabilize somewhere above the 1.0521 level.