Review and dynamics
Since the opening of today’s trading session the pair EUR/USD has grown by 20 points by the beginning of the European session; however the trading volumes are low before the release of the US labour data.
Earlier the pair EUR/USD has managed to regain after the strong decline in the past two months and increase by about 100 points.
Despite ongoing correction, the USD is the market’s favourite and the EUR/USD may find it difficult to reach again weekly highs at the level of 1.0685.
The pair EUR/USD remains under strong pressure from the USD, weak European statistics and difference of the monetary policies of the US Fed and the ECB.
On the weekly and monthly charts the indicators OsMA and Stochastic give sell signals; on the daily and 4-hour charts the indicators give signals for long positions showing that the upward correction may continue with the targets of 1.0740 (ЕМА144) and 1.0795 (ЕМА200 on 4-hour chart).
In case of break out of the level of 1.0795 the pair may rise up to resistance level of 1.0840 (lows of last month), 1.0900 (lows after Brexit referendum), 1.1070 (ЕМА200 on the daily chart, ЕМА50 and upper line of the descending channel on the daily and weekly charts).
Pressure on the pair EUR/USD is caused by poor macro-economic European statistics and difference in the policies of the US Fed and the ECB. The pair EUR/USD remains in the descending channel on the weekly chart with the lower limit near 1.0530, and on the daily chart with the lower limit near 1.0485 (Fibonacci 0% and the lows after the decline from the highs of 2014).
Short positions are preferable and the rise in the pair is likely just a part of the upward correction.
Support levels: 1.0630, 1.0600, 1.0580, 1.0530 and 1.0485.
Resistance levels: 1.0740, 1.0795, 1.0820, 1.0900, 1.0975 and 1.1070.
Sell on the market. Stop-Loss: 1.0710. Targets: 1.0630, 1.0600, 1.0580, 1.0530 and 1.0485.
Buy Stop: 1.0710. Stop-Loss: 1.0660. Targets: 1.0740, 1.0795, 1.0820, 1.0900, 1.0975 and 1.1070.
In the descending channel
Upward correction with the targets of 1.0740 and 1.0795