Euro: USD/EUR (EUR=X) investors are focused on macro data updates for short term profit opportunities
Since trading session opened for the week in Pacific-Asian market hours, the pair has managed to hold on to steady upside price action and moved well near last week’s highs as the spread difference between 2-year US-Germany government bond yields shrunk to 11-months low.
This is a highly bullish factor for EURO bulls as the spread difference has fallen below 300 points for the first time since April 2018. The pair hit a new two week high during Asian market hours at 1.13449 on influenced gained by declining spread difference. As of writing this article, EURUSD pair is trading 1.1341 up by 0.13% on the day. Moving forward investors are focused on macro data updates for short term profit opportunities.
This week will see the release of the latest FOMC interest rate decision and traders are expecting that the Fed’s forward guidance is likely to be dovish even if they keep interest rate unchanged for the month. Speech from Fed members in recent past suggested that they were even ready to cut interest rates if needed depending on economic conditions.
Given disappointing macro data released so far this month, investors believe that Fed is likely to retain dovish stance and reiterate their plans for rate reduction in case the macro data updates from the US continue to retain the disappointing tone in near future. This has led to USD weakening in broad market adding to the EURO’s strength during Asian market hours and is expected to continue supporting the pair on its positive price action for rest of the day.
On the release front, both EURO & U.S.A see the release of second-tier macro data updates. E.U. calendar sees the release of trade balance data and speech from ECB members De Guindos & Peter Praet while the U.S. calendar will see cap goods ship non-defense ex-air data. Expected support and resistance for the pair are at 1.1329, 1.1300, 1.1296/95 and 1.1367, 1.1388, 1,1419 respectively.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 1.14.
The projected upper bound is: 1.15.
The projected lower bound is: 1.12.
The projected closing price is: 1.13.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 23 white candles and 25 black candles for a net of 2 black candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 84.0508. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 5 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 53.40. 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 152 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 47. This is not a topping or bottoming area. The last signal was a buy 4 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 1 period(s) ago.
Rex Takasugi – TD Profile
FOREX EUR= closed up 0.002 at 1.135. Volume was 74% below average (consolidating) and Bollinger Bands were 4% narrower than normal.
Open High Low Close Volume___
1.132 1.135 1.132 1.135 38,082
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 1.13 1.14 1.15
Volatility: 8 7 8
Volume: 135,929 148,259 143,210
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.
FOREX EUR= is currently 1.2% below its 200-period moving average and is in an downward trend. Volatility is relatively normal 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 7 periods. Our momentum oscillator has set a new 14-period high while the security price has not. This is a bullish divergence.
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