FBS: outlook for EUR/USD
EUR/USD is trading in the $1.3275/50 area today. The pair has reached the top of the H4 Ichimoku Cloud and the base line of the daily Cloud. French industrial production contracted by 0.6%, while a 0.7% growth was expected. US will release job openings at 14:00 GMT. Apart from this there’s nothing in the economic calendar for today.
Some decline from here would be natural given 2 solid bullish daily candles. However, a rise above $1.3280 and $1.3300 will crush the bears. Further resistance will be at $1.3322 and $1.3350. As long as euro trades below this area the outlook will remain neutral with a bit of downside bias. Support lies at $1.3223 (daily conversion line), $1.3200 and $1.3192.
So far euro was gaining for 2 days as weaker than expected NFP and the decline of the risk aversion overshadowed the ECB’s dovish tone. However, the most analysts are still sure that the Fed will reduce QE this month (the average NFP gain during the last 12 month was 160K a month; the unemployment rate declined from 8.1% in September 2012 to 7.3% in Sep 2013). This makes EUR/USD vulnerable to the downside.
Chart. Daily EUR/USD
By Elizaveta Belugina