20, August 2014

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

The European currency was the most vulnerable asset at yesterday's auction - the euro fell against the dollar and the pound. The reason for this could be the German Central Bank statements about the weak Germany economic outlook against the backdrop of geopolitical tensions. The French Finance Minister, called on the European Central Bank to weaken the euro, as euro exchange rate is overvalued and does not correspond to its real value and limits the economy growth.

The pair has spent above the strong support level of 1.3340 about three weeks. The EUR/USD is trading is in the direction of the descending channel. The sellers broke the level of 1.3340 at growing volumes

The support is at 1.3290. The resistance is at 1.3360.

There is a confirmed and strong sell signal. The price is below the Cloud and it is above the Chinkou Span. The Tenkan-sen and the Kijun-sen are directed downwards. The downward movement will be until the price is under the Cloud.

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

Trading recommendations

We believe the downtrend will be continued. The target is 1.3290.