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9 Dec 2014
EUR/USD volatility plays out around key 1.24 handle - FXStreet
FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet explained that volatility ruled the markets on Tuesday, with the dollar trading alongside with stocks ever since early Asian opening.
Key Quotes:
“The risk aversion was triggered by rumors China may lower it economic growth targets following worse than expected trade balance earlier this week”.
“But the negative sentiment spurred stocks selling and profit taking on dollar bulls, rather than send investors towards the save haven”.
“The EUR/USD pair found also support in a slightly improve in German Trade Balance readings, whilst nose diving US indexes did the rest”.
“The pair rose near post ECB’s meeting high, reaching 1.2447 before retracing back below the 1.2400 mark. Adding to the general confusion, there were rumors of an early elections in Greece that put in doubt whether the country will honor the terms of its bailout program.
“But US stocks erased its intraday gain mid American afternoon, giving the dollar a breath. The EUR/USD fell back below the 1.2400 mark, with the 1 hour chart showing price finding short term support at its 200 SMA, while 20 SMA maintains a strong bullish slope below current price, and indicators turned lower from overbought levels”.
“In the 4 hours chart, indicators had crossed their midlines to the upside but lost upward potential, now flat above their midlines”.
“The dominant bearish trend has been hardly disturbed by this intraday upward corrective movement, yet it will take some follow through below the 1.2320 to confirm a return of the bearish momentum”.
“Renewed advances above 1.2400 on the other hand, may see further gains in the pair on profit taking ahead of the year end”.
Key Quotes:
“The risk aversion was triggered by rumors China may lower it economic growth targets following worse than expected trade balance earlier this week”.
“But the negative sentiment spurred stocks selling and profit taking on dollar bulls, rather than send investors towards the save haven”.
“The EUR/USD pair found also support in a slightly improve in German Trade Balance readings, whilst nose diving US indexes did the rest”.
“The pair rose near post ECB’s meeting high, reaching 1.2447 before retracing back below the 1.2400 mark. Adding to the general confusion, there were rumors of an early elections in Greece that put in doubt whether the country will honor the terms of its bailout program.
“But US stocks erased its intraday gain mid American afternoon, giving the dollar a breath. The EUR/USD fell back below the 1.2400 mark, with the 1 hour chart showing price finding short term support at its 200 SMA, while 20 SMA maintains a strong bullish slope below current price, and indicators turned lower from overbought levels”.
“In the 4 hours chart, indicators had crossed their midlines to the upside but lost upward potential, now flat above their midlines”.
“The dominant bearish trend has been hardly disturbed by this intraday upward corrective movement, yet it will take some follow through below the 1.2320 to confirm a return of the bearish momentum”.
“Renewed advances above 1.2400 on the other hand, may see further gains in the pair on profit taking ahead of the year end”.