EURUSD: Prefer to buy dips
|EUR/USD: 1.0738
The Euro spent a relatively quiet Friday session confined to a range of 1.0727/82, capped on the topside after a poll indicated that Marine Le Pen is making gains in the French election, while supported on the downside by the soft tone to the dollar.
The short term momentum indicators suggest that we may be in for a similar session on Monday, with the 4 hour charts being overbought and turning to point lower, while the dailies are beginning to look a little more constructive. The contradictory look of the indicators suggest that EurUsd will remain choppy and rangebound on Monday and possibly Tuesday. If wrong, and the Euro can make further headway, then above Friday’s high would find sellers at the descending trend resistance, now at around 1.0790 and which should be strong at the first attempt. Beyond there though, could then head towards 1.0830, a break of which we could then see a run towards 1.0873 (8 August high) and on to the 200 DMA (1.0900). On the downside, support will be seen at the minor Fibo levels from the move up from the recent 1.0490 low, beginning at 1.0715 and then at 1.0670. As before, given the increasingly positive look of the daily charts, it would appear that buying dips is the current plan although I remain wary of buying the Euro towards the top end of the recent range, and if Le Pen makes further advances in the French polls the Euro will find it has limited topside potential.
| 24 Hour: Prefer to buy dips | Medium Term: Neutral | ||
| Resistance | Support | ||
| 1.0900 | 200 DMA | 1.0727 | Friday low |
| 1.0873 | 5 Aug high | 1.0714 | (23.6% of 1.0494/1.0782) |
| 1.0829 | 2 Feb | 1.0670 | (38.2% of 1.0494/1.0782) |
| 1.0790 | Descending trend resistance | 1.0635 | (50% of 1.0494/1.0782) |
| 1.0782 | Friday high | 1.0605 | (61.8% of 1.0494/1.0782) |
Economic data highlights will include:
M: German PPI, BuBa Monthly Report, US Chicago Fed National Activity Index, Fed’s Evans Speech
T: US Current Account, Fed’s George Speech, API Weekly Crude Oil Stock Inventory
W: ECB Non-MP Meeting, Current Account, US House Price Index, Existing Home Sales, EIA Crude Oil Stocks Weekly Change
T: German Consumer Confidence, EU Economic Bulletin, Targeted LTRO, Janet Yellen Speech, US Jobless Claims, Kansas Fed Mfg Activity, New Home Sales, Fed’s Kashkari Speech EU Provisional Consumer Confidence
F: EU/US Flash Mfg/Composite/Services PMIs, US Durable Goods Orders, Fed’s Evans/Bullard Speeches
Interested in EURUSD technicals? Check out the key levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.