The EUR/USD has reached fresh new lows today, could drop even lower as the rate is located deep in the seller’s territory, the rate is approaching the lowest low registered right after the Brexit referendum, the currency pair has decreased as the Us dollar index has reached new highs today, the index is expected to increase further in the coming period because has jumped much above the 96.70 static resistance.
The Us dollar index needs to make new highs very soon, otherwise could lose the bearish momentum and could force the USD to decrease on the short term again.
The pair has decreased even if the Euro-zone data has come much better, the German PPI has increased by 0.4%, has exceeded the 0.2% forecast, actually has remained steady at 0.4% growth, moreover the Current Account has decreased from 36.4B to 30.8B, has come better than the 24.9B estimate. The Euro was punished by the Euro-zone Consumer Confidence, the economic calendar has decreased by 8 points, has come in line with expectations, the Euro continues to decrease versus all its counterparts.
The US dollar edges higher even if we didn’t have any significant economic data from the United States, the US has released only the Crude Oil Inventories, but this event doesn’t have any impact on the EUR/USD pair. The greenback continues to increase because the Building Permits and the Housing Starts have come better in yesterday’s trading session, actually the Building Permits have increase surprisingly higher, from 1.14M to 1.19M, have surged much above the 1.17M estimate.

You can see that the price has found strong resistance at the 1.1123 level, has failed to retest the lower median line of the major ascending pitchfork an now is going down quickly, could approach the 1.0908 level in the coming days if the US data will continue to come better, remains to see what will happen in the coming week when the Federal Reserve is expected to publish the Federal Funds Rate, the FED is expected to maintain the rate on hold at 0.50%, we’ll see how the EUR/USD will react if the FED will disappoint again, the trader’s could lose their faith in the FED. The currency pair is expected to drop further because has escaped from the previous ascending pitchfork, has failed also to retest the median line of the descending pitchfork (drawn with blue), right now is approaching the lower median line of the descending pitchfork, the pair could increase again only if the pair will fail to touch this downside obstacle.

The price is moving somehow sideways on the short term, the rate needs to take out the support of this extended range, the rate is moving downward inside of a minor descending pitchfork (drawn with black), the pair has failed to retest the upper median line of the pitchfork and now is expected to fall towards new lows. The rate could move sideways in the coming days till will have a clear direction, between the 1.0908 level and the 1.1123 resistance.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.