EUR/USD plunges to 1.18

31 ago 2017

Morning outlook - EUR/USD plunges to 1.18

• As it was expected, during the whole previous trading day the currency exchange rate was moving in ascending channel. At the moment, it is approaching a combined support level formed by the weekly PP at 1.1865 and the 200-hour SMA.
  
  
• A rebound is expected to happen even if the rate will manage to slightly overstep beyond that barrier. One of the reasons is that a little bit lower there is located a bottom boundary of a large ascending channel that guides movement of the pair. The second reason is that there will be no notable data releases today. This means that the buck will not get any additional impulse from traders, anticipating these events (as it happened during the last couple of days).
  

1 set 2017

Trade chiuso: obiettivo raggiunto

EUR/USD makes an expected rebound

In line with expectations, yesterday the buck relentlessly tried to break though the combined support level formed by the monthly PP, the 200-hour SMA and the ascending channel’s bottom boundary. As it was suspected, it managed to slightly overstep beyond the barrier. However, the downside momentum was not strong enough to fix the result.

Today the pair is expected to make one more unsuccessful attempt to slip to the bottom. The only difference is that this time the southern side will be additionally secured by the weekly PP at 1.1881. Similarly to the previous trading day, it might break to the bottom.

But, in any case, the fall is not expected to go below the 1.1840-50 mark, as it represents a location of the dominant ascending channel’s lower trend-line.

On the other hand, there is a need to keep in mind an effect from release of data on the US Average Hourly Earnings, Non-farm Employment Change and Unemployment Rate.