As it was expected, the Friday trading caused neither any sharp fall, nor rapid increase of the EUR/USD currency pair. Small correctional decrease right after the Asian trading session opening of 100 points by the middle of the European deals was considered as the fortunate moment for purchases that allowed pair to return back to the earlier reached levels. The pair did not achieve a new monthly maximum as it was every day during all last week, but it reached the new sessional minimum around 1.4650, where the good support level is located. Totally, the US dollar won back 32 points from the European currency.
Considering that only the eurozone fundamental analysis was published on Friday, it is necessary to mention the growth of the Germany manufacturers price index which moved upward to 0.5% since the last month, against the -1.5 % decrease. Experts expected the growth of this indicator to 0.1 %. The Eurozone active account left a negative zone for the first time for the last year and showed a plus quarterly difference between imported and exported goods, services, income flow of 6.60 bln. The experts did not expect the changes in value of this indicator.
From a technical picture we see, that ascending dynamics proceeds to put serious pressure upon the US dollar, gradually reducing it against the euro. For the medium-term rising price channel from July, 08 (it is black color on the graph) the first support level, on a way of the pair decrease, is 23.6 % correctional Fibo level, which is around 1.4547. Near to that area will be the bottom bound of our up-going price channel. Concerning the more short-term pair prospect, very soon we can see testing of the bottom bound of the rising price channel from August, 31 (it is green on the graph) which can be easily constructed due to the good euro growth.
Now the Bollinger bands show us the moderate market liquidity and are ready to turn in any direction and to follow both growth, and falling of the pair, drawing after that new support and resistance levels. MACD indicator once again entered the sale zone, after small attempt of restoration to the Friday deals closing.
One of the nearest and serious support levels is the 200-day exponential moving average which is close to the pair around 1.4625.
The key resistance levels are: 1.4688, 1.4768, 1.4800
The key support levels are: 1.4650, 1.4621-05, 1.4533
Today, I recommend to buy the pair at 1-hour timeframe closing above 1.4720 with the target – T/P 1.4769 and S/L 1.4672
Sell the pair at 1-hour timeframe closing below 1.4677 with the target – T/P 1.4630 and S/L 1.4710.
Best regards,
Analyst: M.A.Magdalinin
