theforexarmy
Short

EURUSD testing major resistance, remain bearish

FX:EURUSD   Euro / U.S. Dollar
Sell below 1.0604. Stop loss at 1.0638. Take profit at 1.0494.
Reason for the trading strategy (technically):
We remain bearish below 1.0604 resistance ( Fibonacci retracement , Fibonacci extension , horizontal overlap resistance) for a further push down to 1.0494 ( Fibonacci extension , horizontal support).
RSI (34) is seeing strong descending resistance pushing price down.
Stochastic (55,5,3) is also seeing strong resistance below our 93% level that is pushing price down and displays bearish divergence vs price which is a good precursor of price making a good reversal from here.

Reason for the trading strategy (fundamentally):
The major news item today affecting USD is the Gross Domestic Product (GBP) which measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy's health. If the actual release is better than the forecast, that means it is good for the currency and we can expect USD to strengthen. However, if the actual release is less than the forecast, that means it is bad for USD and we can expect USD to weaken. Our current forecast is for a rise from 1.9% to 2.1% which means we could expect a weaker USD, which goes in line with our bearish EURUSD view.

The other major news event driving the USD today is the U. of Michigan Confidence. It assesses consumer confidence regarding personal finances, business conditions and purchasing power based on hundreds of telephone surveys. A low or falling University of Michigan Sentiment value is considered an early indicator of an economic downturn. We’re expecting a higher value which means a stronger USD, which goes in line with our bearish EURUSD trade today too.
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