Analytical Review of the Currency Pair EUR/USD

Analytical Review of the Currency Pair EUR/USD

4 April 2016, 16:12
Roberto Jacobs
0
15

Analytical Review of the Currency Pair EUR/USD

Technical data of the currency pair:

Previous closing: 1.1389;
Daily range: 1.1371-1.1412;
Opening: 1.1400;
52- week range: 1.0519-1.1713;
Annual revenue: +3.90%;
Change in % for the previous day: +0.09.

Analytical review:

  • Over the last four trading sessions Euro has significantly strengthened against the USD (over 230 points). During trading session last Friday the rally in Euro was halted at the resistance level of 1.1430.
  • Last Friday important US statistics was released, which showed that the number of employed has grown by 215000 in March against the forecast of 205000. Unemployment rate amounted to 5.0% against the forecast of 4.9%.
  • In March PMI in the US manufacturing sector rose by 2.3 points, up to 51.8., which was above the forecast of 50.7 points.
  • “Commitments of Traders” shows mixed picture. Large speculators have increased the number of long positions by 4206 contracts. Short positions have been increased by 7729 contracts.
  • Economic data of this week will include business activity index in the non-production sector (Tuesday) and speech by the head of ECB Mario Draghi (Thursday). This news may have effect on the dynamics and volatility in the market.


Summary:

  • Positive US macro-economic data, deterioration of the market sentiments in EU and increase volatility in the market put strong pressure on the currency pair. According to “COT” large investors do not have general opinion about Euro.
  • It is expected that Euro will fall against the USD. It is recommended to open short positions. It is expected that Euro will fall against the USD. It is recommended to open short positions.


Trading tips for the currency pair EUR/USD

Medium-term trading: At the moment the currency is traded in the range of 1.1340-1.1430. After breaking out and testing of the lower limit of the range and in case of the respective confirmation (such as Price Action pattern), we recommend to open short positions. Risk per trade is not more than 2% of the capital. Stop order can be placed slightly above the signal line. Take profit can be placed in parts at the levels of 1.1250, 1.1180 and 1.1090 with the use of trailing stops.


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Short-term trading: on the chart with the timeframe 15M the currency is traded in the range of 1.1375-1.1410. We recommend to enter the market after breakout and testing of these levels. Positions can be opened slightly above/below the signal line. Take profit can be placed in parts of 50%, 30% and 20% with the use of trailing stop.


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The material has been provided by LiteForex - Finance Services Company - www.liteforex.com


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