The Euro, after a tremendous sell-off in last night’s session, is now trading with a positive bias. It so far recovered most of its losses, while ascending above its resistance zone near $.1.25285, which happens to be its 100-day moving average.
Many analysts are eagerly awaiting the outcome of the European Central Bank press conference, which is scheduled for 14:45 GMT. Speculations are rampant that the ECB will introduce its own form of quantitative easing in order to uplift a floundering Euro-Zone economy. The dismal economic reports that sprung out of almost all of its economies have forced the European Commission to cut growth and inflation forecasts, which is of course harmful to the Euro in the short-term.
The USD meanwhile is enjoying further rise in demand, and will certainly continue should the Federal Reserve provide positive sentiments. Traders should keenly focus on all upcoming economic reports, especially tomorrow’s NFP statement, which should provide us all insight regarding the strength of the world’s biggest economy.
When looking at the hourly chart, the next level of resistance for the EUR/USD comes near the $1.25445 level, while support continues to remain near the $1.24708 zone. Additionally, its momentum indicator has a bullish bias, implying a build-up of buying interest at those levels. Furthermore, the EUR/USD’s relative strength index also is now trading with a positive bias, which is a bullish indicator. Lastly, it is imperative to state that the EUR/USD continues to trade very close to its 2-year lows, sustained in Mondays’ trading session.
Short the EUR/USD with a strict stop loss above $1.25445 and an intermediate target at $1.24708