29, July 2013

EUR/USD (a 4-hour chart)

EUR/USD (a 4-hour chart)

General Overview

Despite the fact that Friday's report showed that business activity in the region is growing but the published data on the conditions in the business environment of the Republic of Germany, provided by the IFO institute fell short of forecasts. According to forecasts the index was 106.3, still it came out 106.2, but compared with the previous month, it was strengthened. Bulls were disappointed that caused the sale of the pair.

The price is in an upward trend. The current buy signal is strong and confirmed as Chinkou span is below the price and the price is above the Ichimoku cloud. The upward movement is targeted to the resistance level 1.3300.

The upward movement is continued as long as the price is above the Kijun-Sen.

Chinkou Span is below the price that is a confirmation of the current buy signal. The Kijun-Sen and Tenkan-Sen are directed upwards. The Cloud is growing.

Bollinger Bands indicator shows an upward movement. The bands are narrowed.
MACD is in a positive area, indicating the current upward movement.

Trading Recommendations

Perhaps the pair reached 1.3296 month high, but at the moment it has already passed in correction mode, as the level of resistance of 1.33 is quite a strong barrier. Considering the lack of major economic indicators, we think that the pair will adjust down to the nearest support on profit taking in the beginning of the week.

From a technical point of view, we expect a corrective pullback down. If the support level 1.3260 is broken, it can return to the level 1.3236. Stop-loss is at 1.3285.