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EUR/USD off-lows, near hourly 200-SMA

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 16, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - The offered tone on the EUR keeps growing bigger in the mid-European trades, knocking-off EUR/USD to fresh five-day troughs below the hourly 200-SMA.

    EUR/USD drops further from 1.1360 region

    The EUR/USD pair falls -0.39% to 1.1343, testing fresh five-day lows struck at 1.1335 in last hours. A renewed bid wave caught the US dollar and hence pushed the EUR/USD pair deeper in the red.

    Growing hopes of further ECB easing and the talks over Dec Fed rate-hike back on the table following upbeat US CPI data continue to underscore the divergence between monetary policy outlooks of both continents.

    Moreover, the shared currency came under fresh selling pressure after the latest CPI figures confirmed deflation returning to the Euro zone. The CPI in the 19-nation bloc dropped 0.1% y/y in Sept following the 0.1% hike seen in August, the weakest reading since March.

    Meanwhile, the major is likely to remain heavy amid the risk-on rally in global equities and on expectations of better consumer sentiment and industrial production figures lined up for release later today.

    EUR/USD Technical Levels

    The major hovers near the hourly 200-SMA with the immediate support in sight located at 1.1300 (psychological levels), a breach of the last would expose 1.1278/1.1276 (20-DMA & 50-DMA) and below which floors would open for a test of 1.1250 (psychological levels). While to the upside, 1.14 barrier should act as the immediate resistance, beyond which 1.1418 (hourly 50-SMA) would be tested and from there to 1.1466 (daily R1).
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