Yesterday\'s closing value on the EUR/USD currency pair was marked by a particular scale range. At the opening of the Asian trading session the pair somewhile stayed in the sideway channel 1.4125-1.4170, then the pair\'s decline to the level of 1.4085 followed with a slight trades hangimg in this zone. The oil quotations together with the American stock market supported the European currency and showed a steady growth with the closing profit value of 5%. The oil price again rose to $75 per barrel. On this background the pair could recover to the opening level, then it broke through several resistance levels by abrupt jump upward, allowing to fix a local maximum near the level of 1.4264.
Totally, the European currency strengthened against the US dollar by 89 points. The volatility rate was marked at a high level.
The European currency reduction at the early deals was mainly due to negative Eurozone macroeconomic statistics. The German PPI dropped by 1.5% against the previous period and again it decreased to a negative zone. The experts were looking for decline only by -0.1%. The Eurozone current account adjusted, determining a quarterly difference between imported and exported goods, services, earnings flow, also reduced to -5.3B, interrupted its 3-months growth.
First and last, the European trading session went under correctional growth, giving a scale for an abrupt jump upward, which had been noticed during the second part of the trading day.
The US fundamental data were registered by worthwhile index numbers. MBA mortgage applications showed an increase by 5.6%, but the US crude oil resources dropped by -8.4M, which pushed the price upward.
In conclusion, let\'s talk about the basis. The well — known investor Warren Buffet said yesterday, that the US economy will have to meet with the collateral efects of «financial medicine», which is a serious danger for the national currency and the economy as a whole. It is clear from his statements that the US economy is on the mend, but the accruals to country\'s real GDP are very large.
The technical picture. Yesterday\'s abrupt jump upward caused a great deal of the Euro purchases, allowing the pair to break through the low line of the up — going price channel from May,15, giving back hope for growth continuation to the Euro. The next support levels are the 38.2% correctional Fibo level and the basis of the 42nd figure, where the pair is currently trading. The area 2.4286, where 200 day exponential moving average is located, may also keeps the pair from dropping attempts. The resistance level is the zone 1.4266, which now is the maximum level of yesterday\'s trading session. Breaching this level the pair will be met by the 23.6% Fibo level, which is at the level of the 43rd figure.
Today I recommend to buy the pair at the 1-hour timeframe closing above the level of 1.4268 with the target — T/P 1.4323 and S/L 1.4217.
Sell the pair at the 1-hour timeframe closing below the level of 1.4202 with the target T/P 1.4151 and S/L 1.4241.
Kind regards,
Analyst: Magdalinin M.
