The pair is on its way down the hill for the past 2 weeks and is losing drastically on a daily basis against the U.S. dollar, and it lost more than 120 points yesterday as guided in our previous reports that the pair would remain bearish as long as it does not move above the 1.2960 level.
Eur/Usd fell from the 1.2890 area down to 1.2765 as it could not break its resistance level at 1.2902 and in addition the ECB member, Amussen, hinted that he would not go against the implementation of another LTRO plan and would support more measures if needed to make the economy better. Moreover, the credit rating of Italy has been downgraded to BBB from BBB+ by S&P, while on the other hand the IMF forecasted that the Eurozone is set to remain in recession for the rest of 2013.
Considering so much negative fundamentals for the Euro, the investors would remain bearish on the pair unless today’s FOMC meeting minutes could help the euro gain against the U.S. dollar.
Currently the pair is moving at 1.2785 where a move above its pivot point 1.2809 could take it to 1.2833 and 1.2856 while a break below yesterday’s low of 1.2765 would open the doors for 1.2721 and 1.2695. The outlook for the euro would remain bearish as long as it does not sustain above the 1.2902 critical level.
Pound Making a Double Bottom
The GBP/USD fell by around 160 points on Tuesday as the Manufacturing sector of the economy contracted by 0.8% and the industrial production did not show any positive signs, hence resulting in the loss of investor confidence in the currency. The pound fell down till 1.4811 after which it bounced back up and is currently move at the 1.4893 area.
The most important thing to note here is that the pair made a DOUBLE BOTTOM yesterday after testing 1.4811 which was the low that it made in February this year. The traders may take this level as a great opportunity to go long on the pair with a tight stop loss, hence according to this double bottom strategy there seem to be buyers entering now.
If the pair breaks the resistance level at 1.4915 then it would target 1.4950, breaking of which could show 1.4999.
Aussie in Bullish Zone at least for now
The pair seems to follow and abide more of its price action theory rather than other medium impact fundamentals, where it went back up by around 150 points after forming a Doji on its 4-hourly chart last week. The pair would remain bullish as long as it is above 0.9128, where its next targets are 0.9241 and 0.9265 if it breaks 0.9220.