30 June 2014, EUR/USD
The deflationary threat is still hovering over the Eurozone and the region leading economy data publication will attract traders’ attention. The leading indicators show a negative background: PPI index in May fell to - 0.8% year on year, the number of unemployed in the last month of spring increased by 24 thousand, after five consecutive months of a reduction, indicating deterioration in a consumer confidence.
The support levels are 1.3570- 1.3590, and the resistance levels are 1.3650 - 1.3670.
MACD is in positive territory. The histogram is growing.
In general, the negative outlook for the euro remains in force, but the continued demand after falling can lead to a greater euro/dollar recovery towards 1.3700-1.3720. Bulls’ inability to consolidate above 1.3618 will trigger an euro decrease and the further support of 1.3545 testing.
We are waiting for the first quarter payment balance release. The growth in net exports in the first three months of 2014 show a decrease in negative payments balance compared to the last quarter of 2013. If we get the data better than the forecast the pair pound/dollar will test the last week high located at the level of 1.7062. Otherwise, we expect a consolidation around the 70 figure.
The support levels are 1.6980 - 1.7010, and the resistance levels are 1.7040 - 1.7060.
MACD is in positive territory. The histogram shows the bulls’ sentiment.
The general sentiment remains positive; the risks of rising above the current maxima are preserved. However, the pound looks overbought, so buying at current levels is uncomfortable. We advise to stay out of the market today.
Japan is to publish a set of important macroeconomic statistics this week. We can single out the consumer price report for May. The sales tax rate increased cost of Japanese goods and reduced private consumption caused the wave of inflationary pressure in April. In the light of this, one can expect the data release according to the forecast with small deviations. As the stock markets are not inclined for a correction, besides the second quarter is almost over and portfolio managers expect to complete it with a good yield – we expect a moderate growth during the day
The support levels: 101.40- 101.50, and the resistance levels: 101.70- 101.90.
The MACD indicator is in a negative territory.
The pair is approaching the support of 101.22. Its break opens the way to the level of 100.68. To loosen the bears’ pressure the pair has to return above 102.20.