17, October 2016

EUR/USD (a 4-hour chart)

General overview

The US dollar strengthened due to revived hopes of a rate hike by the Fed in 2016. Investors waited for Janet Yellen's speech expecting fresh hints on the Fed's rate hike outlook.

Current situation

 The EUR/USD tested the level 1.1000 again. The mark 1.0984 rejected its first attempt to break the level. The price bounced off the level, however, the recovery was short-lived and stopped around 1.1050 where the euro got under selling pressure. Sellers pushed the price lower and broke the 1.1000 level in the North American session. The price bounced downwards from the 100-EMA and moved below the 50-EMA in 1 hour chart. The 50-EMA acted as a resistance for the price. All moving averages are heading lower. The resistance comes in at 1.1000, the support stands at 1.0950.

MACD is in the negative area. The histogram decreased which confirms strength of sellers. RSI remained in the oversold area.

Trading recommendations

The overall sentiment remains negative.  A break below 1.1000 would open the way to 1.0950. To trigger recovery we need a daily closing above 1.1050.