No Surprises as the EUR/USD Continues to Plummet

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eurusd pic 2 nov 26

After trading in a very narrow range throughout the early half of the session, the Euro fell against the USD thanks to statements from a senior European Central Bank official. As of now the ECB plans on implementing a Quantitative Easing program as early as the first quarter of next year. It is important to note that the Euro has come under immense pressure throughout the last few months as speculations grew rife that the ECB would introduce its own QE package.

Divergent policy stances adopted by both the Federal Reserve and the ECB have both economies heading in opposite directions. The Fed is seemingly on its way to hiking the U.S. interest rates sometime in the coming fiscal year. The ECB on the other hand put tremendous pressure upon the Euro, causing it to trade at multi-year lows and a number of economists believe that it will only continue to weaken against the Greenback.

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Investors should keenly pay attention to upcoming slew of U.S. economic reports scheduled for release starting at 14:30 GMT, which will be closely followed with the monthly New Home Sales data at 16:00 GMT.

When looking at the hourly chart, the EUR/USD breached its support zone near 1.24657 and is now trending lower. Its next level of support is centred at $1.24151. Additionally, its momentum indicators are clearly implying sell, which imply that momentum is shifting towards the sell side. Lastly, its relative strength index is additionally providing a sell signal, which is undoubtedly a bearish indicator.

Actionable Insight:

Short the EUR/USD at current levels for an intermediate target at $1.24151.

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Deepak Tiwari, a law graduate, has been working as a journalist for six years now. He currently writes on Bitcoin, economic, and Forex related news at ForexMinute, the brand new financial news portal which is making waves among Forex traders around the globe for the innumerable Forex resources it offers for readers, traders and brokers. His other specialties include writing on law & governance, finance, internet marketing, careers, politics, international relations & diplomacy, etc.