Last week the pair fell to its 15-month lows amid publications of mixed data from the US and lowered risk appetite on the market.
Today the pair was supported by poor data from Japan. The Japanese GDP for the fourth quarter of 2015 shrank by 1.4% against the previous year. In addition, data on Industrial Production came out worse than expectations as well, at -1.9%.
Today low volatility is expected on the market due to a public holiday in the US.
Support and resistance
On the daily chart, the pair is trading along the lower MA of Bollinger Bands. The price remains below the EMA50, EMA100 and EMA144 that are directed down indicating a descending trend. MACD histogram is in the negative zone and its volumes are very high. ADX is horizontal, while DI lines are heading in opposite directions.
Support levels: 113.37, 111.63, 111.00.
Resistance levels: 115.83, 116.82, 118.27, 119.00, 119.95, 120.80, 121.74, 122.55.
Long positions can be opened from current prices with targets at 114.20, 115.00 and stop-loss at 113.20. Validity – 2-3 days.
Short positions can be opened from the level of 113.20 with the target at 112.30 and stop-loss at 113.80. Validity – 2-3 days.