Euro: USD/EUR (EUR=X) Bounces Around In Uncertainty

Euro: USD/EUR (EUR=X) Bounces Around In Uncertainty

Euro: USD/EUR (EUR=X) Bounces Around In Uncertainty

The Euro has been overbought for some time, although there are fundamental shifts in perception when it comes to central bank actions. In other words, the Federal Reserve is expected to cut rates, and they certainly have more room to move than the European Central Bank does. The 200 day EMA has of course attracted a lot of attention, and if the market were to break down below the level, then it opens up the market to pull back towards the gap from the beginning of the week.

To the downside, the 50 day EMA sits right there at the gap, so that of course will have a certain amount of influence as well. Ultimately, this is a market that continues to thrash around and that is very likely to be a main theme going forward, as there is so much uncertainty as to what the market can expect from central banks. While the Federal Reserve is anticipated to cut interest rates going forward, it does make sense that there is a certain amount of US dollar weakness, but quite frankly I believe that it’s not until the 1.1250 level is broken to the upside that the Euro rally can be taken seriously for a longer-term move.

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 1.12.

The projected lower bound is: 1.10.

The projected closing price is: 1.11.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 7 white candles and 2 black candles for a net of 5 white candles. During the past 50 bars, there have been 24 white candles and 25 black candles for a net of 1 black candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 81.9220. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 8 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 64.26. This is not a topping or bottoming area. However, the RSI just crossed below 70 from a topping formation. This is a bearish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 0 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 129.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 9 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 6 period(s) ago.

Rex Takasugi – TD Profile

FOREX EUR= closed down -0.005 at 1.112. Volume was 13% above average (neutral) and Bollinger Bands were 113% wider than normal.

Open     High      Low     Close     Volume___
1.117 1.119 1.109 1.112 74,217
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 1.10 1.10 1.11
Volatility: 9 7 6
Volume: 92,220 68,549 72,556

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX EUR= is currently 0.2% above its 200-period moving average and is in an upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect volume flowing into and out of EUR= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on EUR= and have had this outlook for the last 2 periods.

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