Euro: USD/EUR (EUR=X) ECB keeps interest-rate at zero, they sound extraordinarily dovish

Euro: USD/EUR (EUR=X) ECB keeps interest-rate at zero, they sound extraordinarily dovish

Euro: USD/EUR (EUR=X) ECB keeps interest-rate at zero, they sound extraordinarily dovish

The Euro has initially tried to rally during the trading session on Thursday but gave back the gains in order to break down below the 1.1075 handle and reach even further. That being said, this is a market that looks like it’s trying to rollover, but I would not expect any type of meltdown. Quite frankly, this pair has been very difficult to trade for months, and therefore the best that you can probably do is look for shorting opportunities on a short-term chart. This isn’t to say that we are going to break down significantly, because there is massive support down at the 1.10 level.

The fact that we are below the 50 day EMA does have me tilting towards the downside, but big moves are not to be anticipated anytime soon. In fact, while the ECB is extending its accommodative policy, the Federal Reserve is continuing to add to its balance sheet. Ultimately, this market looks as if it’s simply wants to go back and forth between the 1.10 level on the bottom and the 1.12 level on the top. With this being the case, the market looks very likely to continue seeing choppy behavior, so it’s very likely that we will continue to see difficulties going forward.

The one thing that I find interesting about the price action over the last couple of days is that we have broken through the bottom of the hammer that formed on Wednesday, showing a breach of minor support. That is yet another reason why it looks likely that we may have a pullback coming in the short term.

Technical Indicators

Overall, the bias in prices is: Sideways.

The projected upper bound is: 1.11.

The projected lower bound is: 1.10.

The projected closing price is: 1.11.

Candlesticks

A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 28 white candles and 21 black candles for a net of 7 white 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 15.9090. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 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 38.98. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. (ERROR: Function did not return a value)

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -140.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 15 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 sell 11 period(s) ago.

Rex Takasugi – TD Profile

FOREX EUR= closed down -0.004 at 1.105. Volume was 23% below average (neutral) and Bollinger Bands were 5% narrower than normal.

Open     High      Low     Close     Volume___
1.109 1.111 1.104 1.105 49,447
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 1.11 1.11 1.11
Volatility: 4 5 5
Volume: 61,123 57,668 76,370

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 0.7% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of EUR= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on EUR= and have had this outlook for the last 4 periods.

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