21 October 2014, 17:34  EUR/USD recovery stopped at 1.2780

The selling interest is confining the shared currency to the lower band of the intraday range so far, with EUR/USD currently hovering over the mid-1.2700s. Spot remains in the red territory on Tuesday, coming down from session tops near 1.2840 following ECB speculations regarding the purchase of corporate bonds. Rumours remain yet unconfirmed, limiting in consequence the ability of the pair to gather traction and return to initial higher levels. On a longer-term view, Chief Analyst Thomas Harr at Danske Bank suggested, “We expect EUR/USD to rebound on a six- to 12-month horizon as eurozone deflation risks disappear and the growth differential between the US and eurozone narrows” As of writing the pair is down 0.44% at 1.2743 facing the immediate support at 1.2731 (low Oct.20) followed by 1.2712 (21-d MA) and then 1.2705 (low Oct.16). On the upside, a break above 1.2838 (high Oct.21) would open the door to 1.2845 (high Oct.16) and finally 1.2887 (high Oct.15).

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