Daily technical and trading outlook – EURUSD
Trend daily chart: Sideways
Daily Indicators: Neutral
21 HR EMA: 1.0541
55 HR EMA: 1.0552
Trend hourly chart: Down
Hourly Indicators: Rising fm o/s
13 HR RSI: 41
14 HR DMI: -ve
Daily analysis: Consolidation with downside bias
– 1.0614 – Mon’s high.
– 1.0571 – Tue’s Asian low (now res).
– 1.0555 – Mon’s NY low (now sup).
– 1.0504 – Tue’s low.
– 1.0470 – Last Wed’s low.
– 1.0445 – Jun 17 low.
EUR/USD – 1.0528… Although euro moved narrowly in Asia y’day following retreat fm Mon’s 2-week high at 1.0614, price briefly rebounded in early European morning to 1.0606 but then tumbled to 1.0504 in NY on renewd usd’s strength.
On the bigger picture, despite euro’s Long Term upmove fm 2017 near 14-year low of 1.0341 to a fresh 3-year peak of 1.2555 in mid-Feb 2018, decline to a near 3-year 1.0637 low (Mar 2020) signals correction has ended. Although euro staged a rally to a near 33-month 1.2349 peak in early Jan 2021, subsequent selloff to 1.1705 (Mar) signals top is made. Euro’s break of 1.1705 n then firm breach below 2020 bottom at 1.0637 in Apr to a 5-year bottom of 1.0350 in mid-May would re- test 2017 1.0341 low (Jan), ‘bullish convergences’ on daily indicators would keep price abv psychological parity handle. Euro’s weakness to 1.0360 in mid-Jun sig- nals correction over n would head twd 1.0213. Only abv 1.0642 risks 1.0748/51.
Today, euro’s fall fm 1.0614 to 1.0504 suggests recent erratic upmove fm Jun’s 1-month trough at 1.0360 has ended n falling hourly indcators signal downside bias remains for weakness twd 1.0445, a daily close below there would head twd 1.0360 next week. Only abv 1.0571 prolongs choppy swings, risk 1.0605/10.
Euro bulls unconvinced with ECB’s anti-crisis promise [Video]
(Ipek Ozkardeskaya – Swissquote Bank Ltd)
Ugly economic data was responsible for a decent plunge in US equities on Tuesday.
The S&P 500 slid 2% yesterday and Nasdaq took another 3% hit following a soft CB consumer confidence index and sharp fall in Richmond manufacturing index, hinting at softer economic activity as a result of tighter Federal Reserve (Fed) policy. European stocks failed to build on the early gains.
Volatility remains high, and oil prices sustained. The latest API data showed an almost 4-million-barrel decline in US oil inventories, versus 110’000-barrel fall predicted by analysts. An eventual cap on Russian oil may worsen the energy crisis, and OPEC will unlikely relieve stress today. On the economic agenda, plenty of central bankers are due to speak today at a European Central Bank (ECB) event, including the Fed Chair Jerome Powell and the Bank of England (BoE) Governor Andrew Bailey. But all eyes are on Christine Lagarde, and her magical anti-fragmentation tool, which will solve the Euro zone debt problem. But euro bulls are increasingly less convinced!