Back
29 May 2013
EUR/USD extends loses to 1.2850; USD ready for more bearishness
FXstreet.com (San Francisco) - The Greenback has been the winner in the first session after the US Memorial day long weekend. The EUR/USD traded lower on the day after the US Dollar joined a pro-risk environment with the pair losing 0.57% on the day to close around 1.2850.
The short term perspective remains slightly bearish in the 1-hour chart according to the FXstreet.com trend index. Indicators such as MACD, CCI and Momentum are pointing lower while the Stochastic is bullish. As for the short term, next supports are located at 1.2821 (low May 23) followed by 1.2809 (low May 20) and then 1.2796 (low May 17). On the flip side, a break above 1.2939 (hourly high May 28) would bring 1.2986 (MA21d) and finally 1.2994 (high May 24).
The Greenback is joining back a pro-risk environment as US consumer confidence and the S&P/Case-Shiller housing prices posting better than expected figures. "The pair felt to a daily low of 1.2851," points FXstreet.com analyst Valeria Bednarik, "and found short term sellers around 1.2880 during the American session, entering Asia with a clear bearish tone according to the hourly chart, as 20 SMA gains bearish momentum above current price while indicators head south below their midlines."
According to the UBS analyst team, the US economy is strengthening the dollar. "Given the stronger US economy, we expect EURUSD to fall further towards 1.26 within the next 3 months." In addition, the Rabobank's strategist Jane Foley commented that, according to the latest CFTC COT report, "EUR shorts continued to increase and now stand at levels not seen since November of last year. EUR shorts still remain well off the levels seen before Draghi’s “whatever it takes” speech".
Regarding the greenback, the expert added that long positions continued to grow in the last week, albeit still below Q1 levels. “The jump in USD longs was mirrored by an increase in EUR shorts as EUR/USD continues to trade the 1.30 handle”, concluded Foley.
The short term perspective remains slightly bearish in the 1-hour chart according to the FXstreet.com trend index. Indicators such as MACD, CCI and Momentum are pointing lower while the Stochastic is bullish. As for the short term, next supports are located at 1.2821 (low May 23) followed by 1.2809 (low May 20) and then 1.2796 (low May 17). On the flip side, a break above 1.2939 (hourly high May 28) would bring 1.2986 (MA21d) and finally 1.2994 (high May 24).
The Greenback is joining back a pro-risk environment as US consumer confidence and the S&P/Case-Shiller housing prices posting better than expected figures. "The pair felt to a daily low of 1.2851," points FXstreet.com analyst Valeria Bednarik, "and found short term sellers around 1.2880 during the American session, entering Asia with a clear bearish tone according to the hourly chart, as 20 SMA gains bearish momentum above current price while indicators head south below their midlines."
According to the UBS analyst team, the US economy is strengthening the dollar. "Given the stronger US economy, we expect EURUSD to fall further towards 1.26 within the next 3 months." In addition, the Rabobank's strategist Jane Foley commented that, according to the latest CFTC COT report, "EUR shorts continued to increase and now stand at levels not seen since November of last year. EUR shorts still remain well off the levels seen before Draghi’s “whatever it takes” speech".
Regarding the greenback, the expert added that long positions continued to grow in the last week, albeit still below Q1 levels. “The jump in USD longs was mirrored by an increase in EUR shorts as EUR/USD continues to trade the 1.30 handle”, concluded Foley.