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EUR/USD wrap-up: mixed technicals- FXStreet

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 15, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet explained that an upward surprise in US inflation data for September, helped the American dollar to recover ground this Thursday, particularly against the EUR, which fell back below the 1.1400 level after trading as high as 1.1494.

    Key Quotes:

    "There were no relevant macroeconomic news in Europe, and the EUR/USD pair traded higher during the first half of the day, amid a sharp recovery in Asian and European equities. But the pair suffered a first hit from Nowotny, from the ECB, who pledged for the use of an additional set of measures in order to achieve the 2.0% inflation target."

    "Then, the US released positive US data, referred to employment and inflation, reviving speculation the FED may raise rates before the year end. The consumer price index decreased by 0.2% as expected, remaining unchanged from a year before. The YoY ex food and energy reading however, resulted at 1.9%, above expectations of 1.8%, while the weekly unemployment claims decreased to 255K last week, against 270K expected."

    "The pair fell down to 1.1362 and has been unable to sustain gains beyond the 1.1400 level afterwards, ending the day around the 1.1380 level. Given that the ECB will have its monthly economic meeting next week, and there are some market talks on a possible QE extension, rallies may remain capped."

    "Technically, the 1 hour chart shows that the price is now below the 20 and 100 SMAs, whilst the technical indicators are barely bouncing from oversold levels, maintaining the risk towards the downside. In the 4 hours chart, however, and despite the price is below its 20 SMA, the pair presents a limited downward potential, given that the technical indicators have turned flat around their mid-lines after correcting extreme overbought readings."
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