EURUSD – Euro Upside Streak Likely Over Vs US Dollar
Aayush Jindal
Key Highlights
The Euro after failing to settle above 1.0900 started a sharp downside move against the US Dollar.
The EURUSD pair broke a major bullish trend line with support at 1.0808 on the 4-hours chart.
Today, the Euro Zone Manufacturing Purchasing Managers Index (PMI) for March 2017 will be released by the Markit Economics, which is forecasted to remain at 56.2.
Today, the Japanese Tankan Large Manufacturing Index for Q1 2017 released by the Bank of Japan posted a rise from 10 to 12.
EURUSD Technical Analysis
The Euro declined recently below 1.0740 due to increase in selling pressure vs the US Dollar. The EURUSD pair is currently below the 100 SMA (H4), and looks poised for more declines.During the downside move, the pair broke a major bullish trend line with support at 1.0808 on the 4-hours chart. The most important move was below the 100 simple moving average at 1.0730. The pair also moved below the 50% Fib retracement level of the last wave from the 1.0494 low to 1.0906 high.So, clearly the pair is under trouble and might be heading lower towards 1.0590. The stated level represents the 76.4% Fib retracement level of the last wave from the 1.0494 low to 1.0906 high. On the upside, the 1.0740 could be a major resistance.
Japanese Tankan Large Manufacturing Index
Today in Japan, the Tankan Large Manufacturing Index for Q1 2017 was released by the Bank of Japan. It presents overall business conditions of the large manufacturing companies. The market was positioned for a rise from the last reading of 10 to 14 in Q1 2017.However, the result was a bit lower, as the Tankan Large Manufacturing Index posted an increase from 10 to 12 in Q1 2017. Similarly, the Tankan Non-Manufacturing Index posted a rise from 18 to 20, which was in line with the forecast. However, there was no major increase in buying interest for Japanese yen, as USDJPY was seen recovering towards 111.50.
Economic Releases to Watch Today
Euro Zone Manufacturing PMI for March 2017 – Forecast 56.2, versus 56.2 previous.
Germany’s Manufacturing PMI for March 2017 - Forecast 58.3, versus 58.3 previous.
UK’s Manufacturing PMI for March 2017 – Forecast 55.1, versus 54.6 previous.
US ISM Manufacturing Index for Feb 2017 – Forecast 57, versus 57.7 previous.
During the downside move, the pair broke a major bullish trend line with support at 1.0808 on the 4-hours chart. The most important move was below the 100 simple moving average at 1.0730. The pair also moved below the 50% Fib retracement level of the last wave from the 1.0494 low to 1.0906 high.So, clearly the pair is under trouble and might be heading lower towards 1.0590. The stated level represents the 76.4% Fib retracement level of the last wave from the 1.0494 low to 1.0906 high. On the upside, the 1.0740 could be a major resistance.