News on the Eurozone economy that was published last Friday, carried some positive information. Purchasing Managers' Index (PMI) for the manufacturing countries in the bloc announced that the activity increase in the sector continues to gain strength. The April Markit report showed PMI estimate improvement for the euro zone.
U.S. news set to be presented this week much less meaningful in terms of the important indicators that can affect the market.
Speech of the Fed chief D. Yellen is the one of the most important political moments of this week.
Friday candle closing led to a downward trend line break 1.3865. This breakthrough provides a good signal for buyers to continue the upward trend with the immediate goal - resistance level 1.3930 which is the maximum in March.
As an alternative we see the price pullback down to a strong support level 1.3800.
British Pound on Friday showed similar movement with the euro against the dollar - quiet trading in a sideways range before the messages from the U.S., multidirectional movement after labor report and then closing the session almost on opening prices. Data on its own economy, presented by PMI index for the UK construction sector, reported a decline for the second month in a row.
Trading volumes for the second month indicate easing upward trend that could soon lead to deep pullback down. However bears at least have to try hard to support level 1.6760 and weekly upward trend line.
At the current time trade continues in the uplink direction. Consequently, the potential growth rises upwards. The main targets are the levels: 1.6900, 1.6950, and 1.7000.
As an alternative we see lower bound uplink 1.6840 breakthrough.
The Japanese currency also came under pressure after the employment statistics in the U.S., but was able to reverse the loss and close Friday at neutral positions against the dollar. Japan continues so-called "golden week", weekdays only start on Wednesday, and important news on the economy before the end of the shortened week are not planned for publishing.
The rebound from 102.65 was not accompanied by increased volume. This suggests that the near-term resistance at 101.80 in face of rising trend line (lower limit uplink) meets the price reduction.
The consolidation may be formed in the area of the mark which in consequence leads to a continuation of the uptrend.
The potential growth target will be in form of repeatedly checked performing strength resistance level 102.65. The break would open the way up to 103.90.
For a sure downtrend sellers need to break the lower boundary of the rising channel 101.80 and 101.20.
We are constantly improving our website quality. If you have any suggestions on how to make our website better or noticed an error on the website, please tell us