EUR/USD trades near 1.16 amid Chinese data release
EUR/USD trades near 1.16 amid Chinese data release
In line with expectations, the currency exchange rate continued to move in southern direction under pressure from the 55-hour SMA. A short dip below the weekly S1 located at the 1.1573 level as well as the subsequent recovery signified two confirmation points, thus confirming existence of a fully-fledged junior descending channel. As the upper-trend line of the pattern is additionally protected by the slipping 100- and 200-hour SMAs, the pair is not expected to make a sudden breakout to the north.
Accordingly, today the exchange rate is expected to test an area near the 1.1555 mark, which might represent a notable support barrier. The average market sentiment, which remains 58% bearish, confirms this general direction. However, the above assumption might be altered due to beginning of Trump visit to China.
In line with expectations, the currency exchange rate continued to move in southern direction under pressure from the 55-hour SMA. A short dip below the weekly S1 located at the 1.1573 level as well as the subsequent recovery signified two confirmation points, thus confirming existence of a fully-fledged junior descending channel. As the upper-trend line of the pattern is additionally protected by the slipping 100- and 200-hour SMAs, the pair is not expected to make a sudden breakout to the north.
Accordingly, today the exchange rate is expected to test an area near the 1.1555 mark, which might represent a notable support barrier. The average market sentiment, which remains 58% bearish, confirms this general direction. However, the above assumption might be altered due to beginning of Trump visit to China.
Despite that American and Chinese companies signed deals worth $253.4B over the last two days, the currency exchange rate stayed neutral. Most probably such hesitations, which result in relentless attempts of the pair to break through resistance area near the 1.6003 level, are related to concerns that Trump’s tax reform could be delayed.
On the one hand, it looks like the surge should be neutralized, as that zone is additionally secured by the 100-hour SMA. On the other hand, yesterday’s movement points out formation of a new minor ascending channel, which already consists of three reaction lows.
From this perspective, the exchange rate is likely to climb to the next resistance level located between the 200-hour SMA at 1.1621 and the weekly PP at 1.1631.