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EUR/USD: sell on rallies for 2016 so far

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 2, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Guatemala) - EUR/USD is currently trading at 20 sma on the hourly chart at 1.0909 at time of writing. The major hit a high of 1.0940 earlier in the shift and run into supply there.

    The 100 DMA has been the upside target since December's business and it is a key objective ahead of the 200 dma at 1.1052. The major has been consolidating the December spike and trading within a channel with a low of 1.0710 on the 4th Jan this year.

    The main theme remains with the divergence of the Central Banks and while the euro is enjoying some upside currently, Draghi is lurking in the background with a dovish stance. Selling rallies has been the trade in 2016 so far and that looks set to remain the best strategy currently while the Fed is still expected to gradually raise rates. Nonfarm Payrolls will be key this week.

    EUR/USD levels

    Technically, EUR/USD, again, has the 200 and 10 dma's as targets on the upside and an advance through there would be impressive. To the downside, the 4th Jan low is a key support area below S3 at 1.0801. RSI (14) is back to neutral on the 4hr chart offering a case for consolidation for the upcoming session in Asia.
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