26, January 2016

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General overview

The IFO business environment indicator attracted traders’ attention being correlated with the Germany GDP dynamics. The production and non-production PMI slowdown does not inspire and we do not expect to see the release with the data better than the consensus forecast. The risk appetite keeps growing among investors. The stock market bullish sentiment is a negative factor for the euro as a funding currency.

The first support resides at 1.0800 and then it goes at 1.0730. The first resistance comes in at 1.0925, the next one is at 1.1050.

There is a confirmed and a strong sell signal. The price is below the Ichimoku Cloud and it is under the Chinkou Span. The Kijun-sen is showing a horizontal movement, the Tenkan-sen is heading down. The downward movement will be until the price is below the Cloud.

The MACD indicator is in a negative territory. The price is decreasing.

Trading recommendations

The move below 1.0730 will signal the presence of sellers. The price may go deeper and reach 1.0630 soon.