21, July 2016

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General overview

The main drivers for the dollar were: positive Building Permits and Housing Starts in the USA and Dennis P. Lockhart’s speech (the Fed representative). According to Dennis P. Lockhart the Brexit did not damage much the USA economy. Moreover, the chances that the USA regulator will hike the rate this year keep growing.

Current situation

The EUR/USD remained under pressure. The euro struggled to regain the 1.1000 level but failed. All its attempts to grow were limited by the mark 1.1030. The instrument remained in the descending channel, at its lower limit. The resistance is seen at 1.1050, the support lies at 1.1000.

MACD is in the negative area. The histogram decreased which indicates the sellers’ strength. RSI returned to the oversold area, its signal line decreased that also indicates sellers’ strength.

The price is below the bearish 50-EMA which still acts as a resistance in the 4 hours chart. The moving averages (50, 100 and 200) are moving downwards which is a sell signal.

Trading recommendations

The pair stopped at the strong support at 1.1000. Should the EUR/USD break the level downwards the pair will decrease to 1.0900.