The EUR/USD currency tool trading passed in the wide sideward channel, with a small advantage of the European currency on Wednesday. One of the main pluses for euro was the renewal of a sessional local maximum after the definitely long falling lately in short-term prospect. The session maximum was fixed at 1.4676. Unfortunately, the pair could not break through the resistance level, which was at 1.4660 at this time that caused a number of the US dollar purchases against the European currency. As it was mentioned, first part of tradings passed mainly under the euro leadership, with small correctional decrease in the middle of the European trading session. The beginning of the American trading was noticed by sharp strengthening of the US dollar that led to pair decrease to the trading day opening level around 1.4578, but there also was good support level which probably played a key role, having pushed the pair back upwards, having allowed trading to close around 1.4640. Totally, the US dollar came down against the European currency by 56 points.
The France producer price index grew by 0,4% in August in comparison with the last month and decreased by 8,5 % in comparison with the same period of previous year. Concerning the German unemployment change, it is necessary to note a decline with correction to-12 thousand, against-5 thousand in August. The experts expected growth to 25 thousand. The German unemployment rate came in at 8,2 % in September against 8,3 % in August, and did not coincide with the analysts’ forecasts, which expected the unemployment data at level of 8.3 %. Probably this first positive data affected the European currency growth in the first half of the trading day. The Eurozone consumer price index /CPI/ fell to -0,3 % in September against -0.2 % in August, and did not reach a zero point. The experts were waiting for this index without any changes. The European currency slightly moved upward amid the comment of the ECB representative Weber, who noticed yesterday that price and financial stability go hand in hand.
The MBA refinancing index in the USA dropped to -2.8 % against the 12.0 % growth month before. The number of the private sector workplaces in the USA decreased to-254 thousand in September, against-277 thousand for the last period. The experts expected the slide to -240 thousand. One of the most important and key yesterday moments was the third USA GDP estimation. Revision ended with a falling to-0.7 % on year from a rate of -1.0 %. The experts expected decrease of -1,2 % on year in the 2nd quarter. Consistently weighted price index in the USA for the 1st quarter remained unchanged and stood at 0.00 %. The pair again climbed from the level of opening to 1.4644 after the all this data release.
In conclusion of the fundamental analysis I will notice that the crude oil reserves in the USA remained without changes at a level of 2.8M.
Taking into consideration the technical aspect it is possible mark some highlights. The yesterday\'s return of pair above the upper bound of the rising price channel from August 13 cast doubt on break through this area, and by the present moment it is necessary to consider some variants of strong sideward motion with the subsequent resumption of pair growth. However, it is necessary to remember that if the EUR/USD pair nevertheless close today below the 1.4612 level, the possibility of the pair decrease continuation to the 45 big figure range is very great. Without rushing, let’s construct with you the borders of the downward price channel, which was already formed at 1-hour timeframe. This channel will be formed from September 22, and its first top point will be the maximum 1.4846 from September 23, when the pair correctional movement began. The next point of the bottom border will be marked by a minimum from September 25, and already then by a minimum from September 29 and will finish its formation.
MACD indicator fell to the sales zone and, probably, we will see the test of 45 big figure in the nearest future, of course, after the pair growth to 1.4633.
Today, I recommend to buy the pair at 1-hour timeframe closing above 1.4673 with the target – T/P 1.4721 and S/L 1.4648
Sell the pair at 1-hour timeframe closing below 1.4616 with the target – T/P 1.4576-41 and S/L 1.4639
Best regards,
Analyst: M.A.Magdalinin
