06, November 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

The dollar was trading slightly lower against most major currencies on Monday. The pair is being corrected after5 days of growth. U.S. factory orders came out slightly worse than it was expected. The pound rose amid UK construction PMI, which remains on the 6 year highs. The euro also strengthened amid the small growth of manufacturing PMI in the euro area.

Fed representative Bullard said that there was still a possibility of QE cutting in December, still the inflation data were still too low for that. Meanwhile, the agency Standard & Poor's downgraded the U.S. GDP growth forecast in the fourth quarter from 1.7% to 1.6% an annual rate.

The bears dominate on the market. The pair is in a bullish trend. Chinkou Span is above the price, and the price is fixed below the Ichimoku cloud, the sell signal is strong and confirmed. Tenkan-Sen and Kijun-sen are directed down, both lines are horizontal. The Cloud is going down as well.

The downward movement remains until the Kijun-sen is located below the price.

Bollinger Bands show a continuation of a southern movement. The bands are narrowing, being directed downwards.
The MACD histogram is in a negative area, its volumes are reducing.

Trading recommendations

The price fell to 1.3491 where it found a support. The price bounced up to 1.3492/1.35. We believe the falling to be continued to 1.3322/42. The growth above 1.3652/62 will show that the bears time is coming to the end, that might become a sign for a growth.