Yesterday, the European currency closed the deals with a slight increase against the US dollar. The Asian and the first part of the European session rolled on under the bears mood, but having touched the low at 1.4272 and meeting the resistance at 1.4276 on its way, the European currency rallied with renewed vigour, refreshing the local minimums at 1.4365. By the end of the trading session the pair\'s growth was considered as a sale sign, due to this the dollar had recovered by the end of the deals. Altogether, the single currency had lost 20 points versus the greenback.
From the Eurozone fundamental data worth pointing out the German GDP, which stood at predicted level of 0.3%, compared to the last period. Most likely that such data promted a moderate Euro lowering against the US dollar at the beginning of the session, as the investors were relying on the GDP upturn amid rising economic improvement in the Eurozone.
A slight strengthening of the Euro was caused by the American positive statistics. Thus, the consumer confidence rose to 54.10, coming in better than the experts forecasts looking for a tick up just to 48.10, compared to the last reading 47.40. A high rate of this indicator points to a high consumer demand. With an optimistic mood the consumers buy more goods and services, which stimulate the economy leading to the national currency strengthening. FRS Richmond index came in line with the estimates of 14.0 and did not promted the price fluctuations, but the house price index fell by 0.1% to 0.5% (in dollars), higher than the analytical predictions waiting for a decline to 0.4%.
The technical interpretation. As it was expected, the trading was moving sidewards with strong diapazon 1.4275-1.4346. The Bollinger Bands still have the sideward movement, noting the dynamic support and resistance levels by their upper and bottom lines, which are coming in line with the lateral channel ranges. Worth noticing that the pair is trading within the upside price channel of May 18, 2009, and its bottom bound is around the 42 big figure. 200-day exponential moving average, which is clearly visible at 1-hour graph, stood below the price and moves around 1.4256.
The next support levels: 1.4283, 1.4257, 1.4237
The resistance levels: 1.4309, 1.4346, 1.4377.
Today I recommend to buy the pair at 1-hour timeframe closing above 1.4311 with the target – T/P 1.4345 and S/L 1.4292
Sell the pair at 1-hour timeframe closing below 1.4280 with the target – T/P 1.4255 and S/L 1.4310.
Best regards,
Analyst: M.A.Magdalinin
