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11 May 2015
EUR/USD: Short term bearish bias in place
FXStreet (Bali) - EUR/USD is breaking lower in Asia, currently at day lows circa 1.1150/55, with Valeria Bednarkik, Chief Analyst at FXStreet, noting that the pair needs to regain 1.1300 to erase the ST bearish bias.
Key Quotes
"Over the weekend China cut its interest rate for the third time in six months, lowering its benchmark to 5.1%, following the release of weaker than expected Inflation readings in the country."
"The PBoC has been working out different stimulus measures in order to support the economy, but so far data has proved those measures have been insufficient. The surprise announcement can lead to some dollar strength at the weekly opening, with gaps expected particularly in European and commodity related currencies."
"Technically, the EUR/USD 4 hours chart shows that the price failed to regain ground above its 20 SMA last Friday, whilst the Momentum indicator heads sharply lower below 100 and the RSI indicator hovers directionless around 48, all of which keeps the risk towards the downside."
"The daily low on Friday was set at 1.1178 which means that a price acceleration below it should lead to additional declines, towards the critical Fibonacci support at 1.1120, 61.8% retracement of the 1.1533/1.0461 decline."
"Buying interest should surge around the level, although a break below it should fuel the decline towards the 1.1050/60 region."
"At this point, the pair needs to regain the 1.1300 level to erase the short term bearish bias and be able to resume its advance, eyeing for the upcoming sessions, a complete 100% retracement towards the 1.1530 price zone."
Key Quotes
"Over the weekend China cut its interest rate for the third time in six months, lowering its benchmark to 5.1%, following the release of weaker than expected Inflation readings in the country."
"The PBoC has been working out different stimulus measures in order to support the economy, but so far data has proved those measures have been insufficient. The surprise announcement can lead to some dollar strength at the weekly opening, with gaps expected particularly in European and commodity related currencies."
"Technically, the EUR/USD 4 hours chart shows that the price failed to regain ground above its 20 SMA last Friday, whilst the Momentum indicator heads sharply lower below 100 and the RSI indicator hovers directionless around 48, all of which keeps the risk towards the downside."
"The daily low on Friday was set at 1.1178 which means that a price acceleration below it should lead to additional declines, towards the critical Fibonacci support at 1.1120, 61.8% retracement of the 1.1533/1.0461 decline."
"Buying interest should surge around the level, although a break below it should fuel the decline towards the 1.1050/60 region."
"At this point, the pair needs to regain the 1.1300 level to erase the short term bearish bias and be able to resume its advance, eyeing for the upcoming sessions, a complete 100% retracement towards the 1.1530 price zone."