09, June 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General overview

Awaited event happened - the ECB lowered its key interest rate and was the first one to introduce negative interest rates on the bank deposits. Furthermore, it was stated that the Central Bank resumes lending (LTRO) and it would not sterilize liquidity and preparing operations in quantitative easing. However, all these measures only briefly pressed the single currency, which eventually returned to its original positions and finished the last trading day with the rise against the dollar. Probably the fact that the direct securities buying so far is only ready, and did not begin to be realized, disappointed the market.

For traders, the last day for the euro/dollar turned out to be quite ambiguous. On the background of fundamental data EUR there was strong support level 1.3590 breakthrough. Then the price sharply turned upward with a further resistance level 1.3645 breakdown.

There is a confirmed and weak buy signal. The price is in the Cloud and it is under the Chinkou Span. The downtrend movement will be until the price is in the Kijun-Sen. The Kijun-Sen is directed horizontally. The Cloud is descending.

The price is finding the first support at 1.3610, the next one is at 1.3570. The price is finding the first resistance at 1.3670, the next one is at 1.3710.

The MACD indicator is in positive territory. The histogram is growing.

Trading recommendations

The short-term consolidation above 1.3645 support level in the long term leads to a continuation of the upward trend. The main growth target is the resistance level 1.3725.