Trading news

EUR/USD: The pair continues to move in the ascending channel

Current trend

At the end of last week European currency had reached the local highs against the USD. The pair received strong support from both Mario Draghi, the head of European Central Bank, and from Investors. Chairman of ECB said that economic growth rate in Eurozone has significantly increased and the regulator raised the forecast of GDP growth this year  up to 1.2%. By 2016 GDP is expected to grow up to 1.8%. He also noted that situation in the currency markets of Europe is stabilizing and there are no reasons to curtail program of securities purchase. All these facts had a positive effect on Euro rate; demand among investors helped the pair grow to the key resistance level of 1.3900. Attention today shall be also paid to investor confidence index in Eurozone and EU economic summit.    

Levels of support and resistance

Currently, the pair consolidates below key resistance level of 1.3900. However, later, following significant growth, the pair will shift to the downward correction and go to the levels of 1.3820 and 1.3800. After correction, ascending movement will resume. The pair will continue to trade in the wide ascending channel. All strong resistance levels have been broken down; therefore new targets are 1.4000 and 1.4120. Technical indicators confirm the forecast of further growth. MACD histogram is in the positive zone above the signal line, directing upwards

Support levels: 1.3820, 1.3800, 1.3770, 1.3700 and 1.3630.

Resistance levels: 1.3900, 1.4000 and 1.4120.

Trading tips

In the current situation it is recommended to place pending orders to buy from support levels of 1.3800 and 1.3820 with profit taking at the level of 1.4000.

 

Dmitry Likhachev

Analyst of LiteForex Group of Companies

Monday, 10 Mar, 2014 / 10:11

Source : http://www.liteforex.com/

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