Euro: USD/EUR (EUR=X) Lingers Around Moving Average Confluence

Euro: USD/EUR (EUR=X) Lingers Around Moving Average Confluence

Euro: USD/EUR (EUR=X) Lingers Around Moving Average Confluence

EUR/USD extended higher on Monday but the rally appears to have stalled at a moving average confluence. The latest inflation data from the United States will be released later in the session which should trigger volatility and ultimately indicate if the pair is to reverse lower from here.

Last week, the US dollar dominated the major currencies, and as such, EUR/USD carries a bearish bias over the near-term. From a broader perspective, the single currency has been recovering higher against the greenback since posting a low in October.

The euro is generally performing well among the major currencies and is the second-best performer among the week thus far, falling only behind the Swiss franc. The British pound is the worst performer as it fell sharply after a poor GDP reading on Monday.

The consumer price index in the US is expected to have risen 0.2% in December, and any deviation from that figure will tend to accompany a sharp reaction in the markets. In addition to the CPI release, FOMC member Williams is scheduled to speak.

Technical Analysis

EUR/USD has been recovering higher for the past two sessions, however, last week’s rejection above 1.1200 stands to draw sellers. With important resistance in play, this could be an area where the pair resumes lower.

Technical Indicators

Overall, the bias in prices is: Sideways.

The projected upper bound is: 1.12.

The projected lower bound is: 1.11.

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 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 27 white candles and 22 black candles for a net of 5 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

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 41.3046. This is not an overbought or oversold reading. The last signal was a buy 1 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 50.59. 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 95 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 -57. This is not a topping or bottoming area. The last signal was a sell 8 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 4 period(s) ago.

Rex Takasugi – TD Profile

FOREX EUR= closed down -0.000 at 1.113. Volume was 11% above average (neutral) and Bollinger Bands were 9% narrower than normal.

Open     High      Low     Close     Volume___
1.113 1.114 1.110 1.113 72,465
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 1.11 1.11 1.11
Volatility: 4 4 5
Volume: 58,909 58,487 78,515

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 0.1% below its 200-period moving average and is in an upward 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 bullish on EUR= and have had this outlook for the last 24 periods.

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