EUR/USD is Facing Uphill Task Near 1.162015 October, 2018 by Aayush Jindal in Market Analysis
- The Euro started an upside correction after trading as low as 1.1432 against the US Dollar.
- There was a break above a major bearish trend line with resistance at 1.1500 on the 4-hours chart of EUR/USD.
- The Euro area Industrial Production in August 2018 increased 0.9%, better than the -0.2% forecast.
- Today, the US Retail Sales for Sep 2018 will be released, which is forecasted to increase 0.3% (MoM).
EURUSD Technical Analysis
The Euro declined heavily below 1.1500 before buyers appeared around 1.1430 against the US Dollar. The EUR/USD pair traded as low as 1.1432 and later started a decent upside correction.
Looking at the 4-hours chart, the pair traded above the 1.1480 and 1.1500 resistance levels. More importantly, there was a break above a major bearish trend line with resistance at 1.1500.
Later, the pair climbed above the 1.1550 resistance area, but it faced a strong selling interest near the 1.1600-1.1610 zone. Moreover, the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours) are also positioned near the 1.1620 zone.
Therefore, the Euro buyers are likely to face a strong resistance near the 1.1600-1.1620 zone. If there is a daily close above 1.1620 and both SMA’s, there could be a decent upward move towards the 1.1750 level in the near term.
On the other hand, if the pair fails to clear the 1.1620 resistance, there could be a downside move towards the 1.1500 support area. Below 1.1500, the next major support is positioned near the 1.1465 level.
GBP/USD also moved higher above the 1.3200 level, but it failed to hold gains above 1.3240 and later corrected lower. On the other hand, USD/JPY started a major downside correction and declined below the 113.00 and 112.50 support levels.
Economic Releases to Watch Today
- US Retail Sales Sep 2018 (MoM) – Forecast +0.5%, versus +0.1% previous.
- US Retail Sales ex Autos Sep 2018 (MoM) – Forecast +0.3%, versus +0.3% previous.