EUR/USD still can go down | 25 Maret 2014

Euro

ZEW institute report on German business climate, which came out extremely negative, showed minimum values for the last 6 months. This release indicates that the Germans hardly pull out the growth of the whole Eurozone economy. In the light of this background, we can expect the release of a weak data on PMI manufacturing sector that will put some pressure on the European single currency.

The support levels: 1.3810-1.3800, and the resistance levels: 1.3860 - 1.3880.

MACD turned up, when the indicator turns downwards, it can be the end of an upward correction.

Trading Recommendations

The growth efforts towards 1.3845 should be seen as an opportunity to open short positions; the breakdown of this level will get us to review the trading strategy. The main support goal is 1.3720, the breakdown of which is essential for the development of a downward correction.

Pound

In the absence of interesting reports from the UK and the U.S. – the market participants will focus on the European macroeconomic statistics. Weak industrial PMI in Germany perked up "bears" to open short positions in the cross-rate euro/pound, which in turn will provide some support for the British currency versus the U.S. dollar.

The support levels: 1.6480 - 1.6395, and the resistance levels: 1.6515 - 1.6550.

MACD is pointing up indicating the current corrective movement rates.

Trading Recommendations

The pound/dollar fell down to 1.6546 last week, then back above the 66th figure and tested the 1.6654 mark.

The minimum target for bears is the 64th figure, the next – the 63rd. Rising above 1.6660 would be an unpleasant surprise for the bears and would force to review the trading strategy.

Yen

The "Bulls" are in an ambush waiting for the right moment for an active play on the growth, but now there are no drivers for it. On Monday, the players didn’t get interesting macroeconomic releases from Japan and the United States and in the lights of this background the attention will be drawn to the "risk appetite" analyze. In the case of the increased geopolitical risks the sales in risky assets are possible. That will support the demand for the Japanese currency and thus would lead down the USD/JPY.

The support levels: 102.16 - 101.90, and the resistance levels: 102.82 - 103.60.

MACD is in a positive area, indicating the current uptrend. The histogram is decreasing.

Trading Recommendations

The bears` inability to back down below the 102-th figure with a subsequent pair growth implies a continued upward trend with the resistance level 102.83 breakdown. The falling below 101.94 will return the pair to a downward correction.