Hello Traders
The recent Euro rally is slowing, if technicals are taken into consideration, there is strong indication of a bear move. The general uncertainty in Europe is obviously driven by UK break away. In fact it has been said that Theresa May has already signed Article 50 letter which is set to be handed over to the EU. Such kind of moves saw the GBP trending lower from yesterday’s European session and continues to slide in the Asian session. The combination of all these saw the Greenback reclaim back its strength and fundamentals streaming in from the EU was also supportive. Being a consumer economy, any kind of consumer confidence should buoy the USD and it precisely did that when Consumer Confidence metric beat expectations and printed 125.6 against 114.0 set by consensus. This was the highest such readings recorded since 2000. Further, there was more news which showed that GOP members were unified behind tax reforms and they will carry out their infrastructure plans concurrently. This kind of unity buoyed the USD.
Technically, the EUR is readying for a move down. There is a clear double bar reversal pattern which has formed in the daily chart with overbought stochastics which has printed a sell signal. The gap up which formed after the failure to repeal and replace Obamacare was also closed yesterday. That bearish engulfing pattern that formed yesterday should be the basis of a long term Euro weakness.
I will trade as follows:
Sell: 1.0800
Stop Loss: 1.0840-above the 61.8 Fibonacci level drawn from yesterday’s High low
Take Profit: 1.05-1.055-this zone has strong support.
Fundamentals to watch out include Crude Oil Inventories and Pending Home sales later in the NY session.
Have a good trading day.

EURUSD 30 min chart-29.03.2017

Source: Dalmas Ngetich

EURUSD Daily chart-29.03.2017

Source: Dalmas Ngetich

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