Yesterday, the European currency strengthened slightly against the US Dollar , which was under pressure from US statistics on ISM Manufacturing PMI. In November, the indicator declined from 50.1 to 48.6 points, while analysts forecasted a growth to 50.4 points.
November Data on Consumer Price Index is due today in the EU. The indicator is expected to come in at 0.2%. Even if the forecast is confirmed, a possible growth in the EUR will be limited as ECB is expected to continue easing its at the upcoming meeting.
Later on, Fed’s Chair Janet Yellen gives her speech. Market participants might get more confirming evidence that the Regulator will raise its interest rates before the year is out. The market is pricing in up to a 75.2% probability of a hike at the December meeting.
Support and resistance
On the 4-hour chart, indicator recommends long positions. is giving a sell signal – the indicator has left the overbought zone; the %K line has crossed the %D line from top-to-bottom.
A likelier scenario seems to be continuation of downward movement within a .
The nearest support levels are 1.0555, 1.0500.
The nearest resistance levels are 1.0688, 1.0762, 1.0820.
Long positions can be opened if the price breaks out the level of 1.0640 with the target at 1.0685 and stop-loss at 1.0630.
Short positions can be opened from the level of 1.0590 with targets at 1.0555, 1.0500 and stop-loss at 1.0600.