EUR/USD: Consolidation

on May 14, 2013

Yesterday the pair was traded in a range between 1.2942 and 1.2999, closing as a bullish daily candle. The 1.3000 brought resistance until the early Asian trading session. The price has failed several times to trade below 1.2960 and at 1.00 GMT jumped to reach 1.3026. Right now the price has pulled back down to test yesterday’s highs and is quoted at 1.2990. The 4H MACD has crossed the signal line, indicating a potential bottoming. On the other hand the upwards trend line from the end of March till now has been crossed below, which could provide more opportunities for shorting. If price rallies higher the first resistance to be noticed is the 1.3050 level. Downwards the 1.2936 low is the first support that has to be passed if price is to go lower.

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The positive economic news from the states give reason to suppose that the Federal Reserve might reduce its 85 billion dollars per month bond buying program.
From Europe consumer prices data and industrial production data is scheduled to be released with the German ZEW economic sentiment being released at 10.00 GMT. ECOFIN meetings are held today. No change in US import prices is expected with the -0.5 value for the previous period expected to be maintained.


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