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#1 18-02-2021 08:58:16

johnedward
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From: Paris - France
Registered: 21-12-2009
Posts: 3068
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EUR/USD: selling pressure has resumed

EUR/USD: selling pressure has resumed


Yesterday, the level of risk appetite was read, on the forex, by a decline of the euro against the dollar. And this even after Tuesday's publication of the ZEW index of confidence in the German economy, the leading economy in the Euro Zone, at 71.1, well above the consensus (59.8).

"Financial market experts are optimistic about the future. They are convinced that the German economy will be back on a growth path within the next few months. Consumption and retail trade in particular are expected to recover significantly, accompanied by rising inflation expectations", says ZEW President Professor Achim Wambach.

Forex traders also learned of the release of the Empire State Manufacturing Index, which was twice its target.

"New orders increased and shipments rose slightly. Delivery times have lengthened and stocks have increased. Both employment levels and the average work week increased. Input prices rose at the fastest pace in almost a decade and selling prices rose significantly. Looking ahead, businesses remained optimistic that conditions will improve over the next six months, and capital spending plans have expanded significantly," the New York Fed says.

Right now, the pair is trading at $1.2104.

KEY CHARTS
In the immediate future, the Tuesday candle, by its significant high shadow at the end of the short lateral movement, is validated by a passage below the 20-day moving average (in dark blue). The opinion will remain negative as long as the spot is below. First objective around $1,1965, the inflection point of 4 and 5 February.

MEDIUM TERM FORECAST
In view of the key graphical factors we have mentioned, our opinion is negative over the medium term on the pair's exchange rate.

Our entry point is $1.2064. Our target price for our bearish scenario is $1.1964. In order to preserve the capital employed, we advise you to position a protective stop at $1.2101.

The expected return on this forex strategy is 100 pips and the risk of loss is 37 pips.

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