Yesterday\'s movement of the EUR/USD currency pair was more moderate than the day before. The sideward channel narrowed further, its bounds were clearly seen around 1.4182-1.4220. Only with the American trading session the dollar tried to rally slightly against the European currency, that led to the local minimum at 1.4158. As we can see, the dollar did not manage to keep the positions, the result - a new Euro growth and the next testing at 1.4229. The trading day closed at 1.4221 with a slight advantage of the U.S.dollar. Overall, the Euro weakened by 5 points, the volatility rate amounted to 101 points.
Why there is no a certain tendency in the market? From my point, it was due to the exchange markets, where currently is witnessed the profit fix-up and a lot of indexes are around strong resistance levels. The second reason may be the absence of fundamental data release, that makes market move.
The only essential Eurozone news turned to be the French consumer expenditure report, which showed a tick up by 1.40%, better than the experts forecasts of 0.4%. Afterwards, was issued the Eurozone new manufacturing orders, which fell by -0.20%, compared to the last period. To remind you, the economists were looking for a growth by 2%.
As seen, the Eurozone did not make any changes and corrections.
The U.S. statistics was not distinct in singularity. The MBA refinancing index showed an upturn by 2.80%. The second Bernanke\'s speech did not confuse the market this time, allowing the European currency to continue its rally versus the greenback.
As it became known yesterday, at the American-Chinese official conversation concerning the strategic and economic cooperation, the Chinese delegation is to draw the USA\'s attention to the nessecity of investments security protection in the American economy. These negotiations will take place in Washington on July 27-28, that most likely to impact the American currency rate.
Concerning the technical pattern, everything remains steady. The upper bound of the ascending price channel of July 08 resisted the bears\' pressure yesterday, that let the pair to push off and test the level at 1.4220. At present, 1.4250 is still of interest. If the Euro succeeds to close above this level, we can expect a new local minimum around the 44 big figure.
The Bolliger bands remained at certain liquidity rate demonstrating a moderate motion, more precisely, the rising trend continuation.
The support levels stood at: 1.4218, 1.4200, 1.4180
The resistance: 1.4250, 1.4270.
Today, I recommend to buy the pair at 1-hour timeframe closing above 1.4283 with the target – T/P 1.4334 and S/L 1.4233.
Sell the pair at 1-hour timeframe closing below 1.4222 with the target – T/P 1.4188 and S/L 1.4255.
Best regards,
Analyst: M.A.Magdalinin
