Strong economic growth bullish for euro
Improving euro-zone growth is bullish for euro. Will the euro continue the rise against the greenback?
On the daily timeframe EUR/USD continues the rally after it hit 32-month high two weeks ago.
- The Donchian channel indicates an uptrend: it is tilted up.
- The MACD indicator is above the signal line and the gap is widening, which is a bullish signal.
- The Parabolic indicator gives a buy signal.
- The stochastic oscillator has not breached into the overbought zone.
We believe the bullish momentum will continue after the price closes above the upper Donchian boundary at 1.2092. It can be used as an entry point for a pending order to buy. The stop loss can be placed below the last fractal high at 1.1822. After placing the pending order the stop loss is to be moved every day to the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets the stop-loss level (1.1822) without reaching the order (1.2092) we recommend cancelling the position: the market sustains internal changes which were not taken into account.
Summary of technical analysis:
| Position | Buy |
| Buy stop | Above 1.2092 |
| Stop loss | Below 1.1822 |