The pound bulls may take a pause | 09 Julio 2014

Euro

The Germany trade balance report was published yesterday. The negative internal background does not give a chance to the strong yield data - the euro high rate together with the decline in industrial production indicates a decrease in Eurozone locomotive net exports.

The euro/dollar slightly fell below last week's low levels and after testing the mark of 1.3576 it rose to 1.3609. Obviously, it is not necessary to talk about any changes in the overall picture.

The support levels are 1.3570- 1.3590, and the resistance levels are 1.3650 - 1.3670.

MACD is in a negative territory.

Trading recommendations

The recovery attempt towards 1.3618 should be used to open the short positions. The growth above 1.3618-1.36605 will weaken the downward pressure.

Pound

The other day "bears" were able to push the price to 71st figure and today the traders’ attention will be focused on the UK industrial production in May results. The leading indicators show a neutral background and if we see the slightly better data than the forecasted medians today we can expect the "bulls" activity and the price restoration to 1.7175. The medium-term trend and the upward decrease in quotations are the great opportunity for long positions opening. The data publication on the consensus-forecast level cannot support the strong demand for the British currency, and we will have another side trend during the day.

The support levels are 1.7090 - 1.7110, and the resistance levels are 1.7170 - 1.7190.

MACD is in a neutral territory.

Trading recommendations

While the pair is trading above of 1.7100, the renewed growth risks and the current maximums testing are remained, and the loss of 71st figure will cause the fall to 1.7150/40.

Yen

The Jap

anese securities buying volume by the foreign investors was significantly reduced the last month of spring. The reduction in net exports in May to 97.3 billion yen just adds the negative. The only "ray of light" - the international reserves growth by the Bank of Japan - but the increase was moderate enough and does not allow the negative background smooth prevailing. Thus, the weak internal conditions will put the pressure on the Japanese yen and we can expect the lost positions recovery.

The "bulls" on the dollar/yen tried to consolidate above the 102nd figure that was breached last week. However, they did not succeed, and the pair fell to the level of 101.68, and then rose to 101.86, without the support at 101.59 testing, and then fell to 101.54.

The support levels: 101.20- 101.40, and the resistance levels: 101.70- 101.90.

The MACD indicator is in a positive territory.

Trading recommendations

The price is in a narrow range between 101.40 and 101.70 levels, the way the price leaves will show the short-term price direction.