Last week the EUR/USD pair significantly declined.
The pair was pressured by the US Fed decision to hike the interest rate by 25 basis points to 0.50%. However, at the following press conference the head of the regulator Janet Yellen noted that monetary policy is going to remain loose for quite a substantial time.
At the same time, the Euro received some support from data on the Industrial Production and Consumer Price Index for the eurozone that came out stronger than expected.
Support and resistance
Bollinger Bands on the daily chart is moving up while the price range is quickly narrowing. MACD is falling and giving a weak sell signal indicating that the downward correctional impulse is ending. Stochastic is in the oversold zone and trying to turn up.
The indicators recommend waiting for clearer trading signals.
Support levels: 1.0843 (local low), 1.0795 (7 December low), 1.0762, 1.0706, 1.0673, 1.0638, 1.0600 (3 December low), 1.0550, 1.0520 (13 April low).
Resistance levels: 1.0900 (local high), 1.1000 (16 December high), 1.1059 (15 December high), 1.1100.
Long positions can be opened after the breakout of the level of 1.0930 with the target at 1.1060 and stop-loss at 1.0840. Validity – 2-3 days.
Short positions can be opened after the breakdown of the level of 1.0790 with the target at 1.0560 and stop-loss at 1.0850. Validity – 2-4 days.