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16 Mar 2015
EUR/USD gains capped at 1.0570 – FXStreet
FXStreet (Barcelona) - FXStreet Editor and Analyst, Omkar Godbole, gives the technical outlook for EUR/USD, explaining that the pair might extend its corrective rally but remain capped at 1.0570.
Key Quotes
“The EUR/USD pair is back above 1.05 levels, with gains being restricted at the 5-DMA at 1.0533 levels in the Asian session.”
“The minor recovery above 1.05 levels is more of a technical driven move. Moreover, the shared currency has repeatedly failed to respond to economic data in the Eurozone, while the US dollar failed to weaken on disappointing retail sales data last week. Markets appear focused on the FOMC meeting this week. Thus, the pair could very well fall back below 1.05 levels.”
“However, the hourly charts, the technical recovery could be extended to the 50-SMA located at 1.0570 levels.”
“The hourly RSI shows bullish divergence, which could result in an extension of a rally to 1.0570 levels. On the hourly chart, we can see that on the last three occasions, an oversold RSI followed by a bullish divergence resulted in a 70-80 pip corrective move post which the selling pressure came back.”
“Given the absence of major Eurozone data today, similar move could take the pair to 1.0570 levels, post which fresh selling pressure can be anticipated.”
“Given the expectations that the fed could drop “patient” word from its forward guidance this week, the pair is likely to fall below 1.0570 levels ahead of the FOMC meet.”
Key Quotes
“The EUR/USD pair is back above 1.05 levels, with gains being restricted at the 5-DMA at 1.0533 levels in the Asian session.”
“The minor recovery above 1.05 levels is more of a technical driven move. Moreover, the shared currency has repeatedly failed to respond to economic data in the Eurozone, while the US dollar failed to weaken on disappointing retail sales data last week. Markets appear focused on the FOMC meeting this week. Thus, the pair could very well fall back below 1.05 levels.”
“However, the hourly charts, the technical recovery could be extended to the 50-SMA located at 1.0570 levels.”
“The hourly RSI shows bullish divergence, which could result in an extension of a rally to 1.0570 levels. On the hourly chart, we can see that on the last three occasions, an oversold RSI followed by a bullish divergence resulted in a 70-80 pip corrective move post which the selling pressure came back.”
“Given the absence of major Eurozone data today, similar move could take the pair to 1.0570 levels, post which fresh selling pressure can be anticipated.”
“Given the expectations that the fed could drop “patient” word from its forward guidance this week, the pair is likely to fall below 1.0570 levels ahead of the FOMC meet.”