Euro traders are closing shorts | 11 Agustus 2014

Euro

As it was expected, Mario Draghi could not surprise the market players with his speech - the current press conference was similar to the previous ones in many respects. Nevertheless, the German 10-year bonds have reacted to the statements of the monetary regulator with sharp drop in yields which is a negative factor for the single European currency.

The ECB's decision to leave monetary policy unchanged and the Mario Draghi’s press conference provoked a quite weak volatility burst against which the euro/dollar was traded between 1.3393 and 1.3337 levels without being able to determine the direction.

The support levels are 1.3375- 1.3350, and the resistance levels are 1.3450 - 1.3430.

MACD is in a negative territory. The histogram is growing.

Trading recommendations

Shall the pair grow the next level of testing would be 1.3430 and 1.3475-1.3500 further on. The growth of the 35th figure will not be a threat to the downward trend, still its break may doubt the single currency sales effectiveness.

Pound

It should be noted that the British currency has strengthened against its major trading partners in June which is a negative factor for net exports.

The Bank of England decision to leave the interest rates unchanged did not help to reduce pressure on the British pound which fell together with the American dollar to 1.6785 - 1.6760.

The support levels are 1.6720 - 1.6700, and the resistance levels are 1.6785 - 1.6800.

MACD is in a negative territory.

Trading recommendations

GBP is a bit oversold, so the rebound above is quite possible. First the pound need to overcome the resistance at 1.6850 after which it will be able to test the level of 1.6900. The loss of the 68th figure will deprive the "bulls" hope for the British currency recovery.

Yen

We got a whole batch of negative macroeconomic statistics last two weeks - exports has been declining for 2 consecutive months, industrial production demonstrates weakness as well. Against this background, it is difficult to expect positive comments regarding the short-term growth prospects. We expect Nikkei 225 to decline which will also put pressure on the pair in the first half of the day.

The support levels: 102.00- 102.20, and the resistance levels: 102.30- 102.40.

The MACD indicator is in a negative territory.

Trading recommendations

Dollar/yen falls again. The pair failed to return above 102.46 which has an interest in the sale, against which it fell to 102.00 - 101.50. The pair could not consolidate below the broken level of 101.59. Thus, the greenback is again trading below the support around 102.20-102.00 which gives reason to believe the resumption of a downward correction. Nevertheless, for its further development is necessary to break the dollar levels of 101.59 and 101.22.