EUR/USD Forecast: 1.1600 or 1.1000?

22 February 2015, 09:06
Andrius Kulvinskas
0
389
The EUR/USD pair has traded within past week range this one, with a higher high a few pips above previous one at 1.1449. Once again, nor fundamental data, neither the technical stance drove the price these days, but Greece. Uncountable headlines have sent price up and down this days, albeit traders remain cautious as no actual news on the matter came out. The pair however, trades slightly below its weekly opening, having bounced sharply from a low of 1.1278 on news Dijsselbloem, EU head, said there are reasons to be optimistic on a Greek deal that may anyway be delayed until Monday. 

Anyway, the pair will probably continue trading on sentiment next week, with chances of a run up to 1.1600 as the deal is reached, on relief. I still believe selling those rallies will be a better choice than looking for a bottom at this point. If there's no deal, 1.1000 is the next bearish target for the pair.

Technically, the weekly chart shows that the technical indicators have resumed their bearish tone after a limited upward corrective movement from extreme oversold levels, while moving averages are too far away above current levels to be even considered. In the daily chart however, the technical picture shows that, over the last 3 weeks, the extreme oversold readings have been corrected, and that the price hovers around a flat 20 SMA while the Momentum indicator heads slightly higher around 100, still showing no much strength. At this point, an upward corrective movement can't be dismissed, particularly as if the situation in Europe gets solved. Above 1.1450, the pair may run up to 1.1530and if above this last, 1.1600 comes next.  

The key support stands at 1.1250, the level that capped the downside since this February began. A break below it exposes 1.1097, the multiyear low set in January, whilst below a quick run towards 1.1000 should be expected.
Share it with friends: