05, November 2015

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General overview

The pair EUR/USD was declining the whole day breaking through one support level after another. The reasons for this decline are both fundamental and technical. The US employment significant growth altogether with Janet Yellen speeches supported the dollar. As we know the European Central Bank monetary policy easing and the 50% chance of the December Fed rate hike are already accounted by the market.

The first support is at the level of 1.0800, the next one is at 1.0730. The resistance levels are 1.0870 and 1.0925.

We have a strong and confirmed sell signal. The price is below the Ichimoku Cloud. The pair is under the Chinkou Span. The Tenkan-sen is crossing Kijun-sen upwards; two lines are forming the “Dead Cross”. The pair will show the southern movement until it is below the Cloud.

The MACD indicator is in a negative territory. The histogram is decreasing.

Trading recommendations

As we expected the pair fell. The targets 1.0925 and 1.0870 are fulfilled. The new decrease target is the level of 1.0800. In case of a rebound the pair can return to 1. 0870.