Euro: USD/EUR (EUR=X) fast approaching major support zone

Euro: USD/EUR (EUR=X) fast approaching major support zone

Euro: USD/EUR (EUR=X) fast approaching major support zone

EUR/USD is at 1.1320 at the start of the new week after falling 1.20% in the previous week’s trading.

The outlook for EUR/USD is marginally bearish with our studies seeing a continuation of the recent decline. However, the pair is reaching a key support zone where further downside progress is likely to be much more difficult and there is a substantial risk of a bounce.

The support zone is situated around the 1.1300 level and is composed of a long-term trendline and the S1 monthly pivot.

For a continuation of the downtrend, we should wish to see a break clearly below this zone, confirmed by a close below the 1.1290 January lows. This would probably lead to a continuation down to a probable target at 1.1215.

Overall, the bias in prices is: Downwards.

The projected upper bound is: 1.14.

The projected lower bound is: 1.12.

The projected closing price is: 1.13.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.

Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.

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 8.6206. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 6 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 39.92. 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. The last signal was a buy 127 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 -116.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 5 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 3 period(s) ago.

Rex Takasugi – TD Profile

FOREX EUR= closed down -0.001 at 1.131. Volume was 73% below average (consolidating) and Bollinger Bands were 19% narrower than normal.

Open High Low Close Volume___
1.133 1.133 1.130 1.131 39,462

Technical Outlook
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 1.14 1.14 1.15
Volatility: 4 7 8
Volume: 151,908 144,501 143,960

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 2.0% below its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 3 periods. our momentum oscillator has set a new 14-period low while the security price has not. This is a bearish divergence.

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