EUR/USD grew above 1.24 to the new highs | 10 December 2014

Euro

The euro has grown against the dollar and has finished the session with a growth. We expect that the Germany's trade surplus rose up to 19.0 billion in October with 18.5 billion euro and in France it fell down to -4.1 billion against-the earlier 4.5 billion euro. The EU finance ministers’ meeting is already planned where the ECB representative will act. The overvalued pair provoked a rebound above 1.2250-1.2270 after it had tested this level. Thus, the euro was able to recover to the level of 1.2350-1.2370.

The support levels are 1.2330-1.2350, and the resistance levels are 1.2425-1.2445.

MACD is in a neutral territory.

Trading recommendations

Despite the bears’ inability to break through the support near 1.2250-1.2270 after the heavy nonfarm and the pair recovery the bulls are not pleased with the euro. For the downward pressure easing it is still necessary to rise up and consolidate above 1.2500-1.2520.

Pound

The British pound has also grown against the dollar. The UK news will present the industrial production data. We expect that the industry continued to grow in October and in total industrial production output increased by 0.2% m/m and 1.8% y/y after + 0.6% m/m, + 1.5% y/y and the manufacturing sector production increased by 0.2 % m/m + 3.2% y/y vs. + 0.4% m/m, + 2.9% y/y in September. The bears did not manage to consolidate below the support level of 1.5580-1.5600 because there was a rebound to the resistance around 1.5660-1.5670.

The support levels are 1.5630-1.5650, and the resistance levels are 1.5730 - 1.5750.

MACD is in a neutral territory.

Trading recommendations

If the pound consolidates above the 56th figure in the short term, we should expect the resistance around 1.5730-1.5750 test and its breakthrough is necessary for the downward dynamics weakening and the resistance mark of 1.5800-1.5820 testing. The decrease below 1.5580-1.5600 can signal about the downtrend resumption.

Yen

The Japanese yen grew up against the dollar. The news noted the money supply expansion in November – the M2 aggregate increased by 3.6% y/y vs. 3.2% y/y while M3 aggregate increased to 2.9% y/y after 2.6% y/y in October. The Japan stock market once again set the tone for trading - Nikkei has fallen by 0.7%. Once being under pressure, the dollar fell down to the support around 120.00-120.20. Now it was broken through and the dollar fell down to 119.05-119.25.

The support levels: 119.05-119.25, and the resistance levels: 120.20-120.40.

The MACD indicator is in a neutral territory.

Trading recommendations

The yen inability to consolidate above the broken through important psychological level of 120.00 increases risks of a larger downward correction development. In turn, bears need to consolidate below 120.00. Its return above this level will call into question the yen ability to develop correction.