The pound wants to return lost positions | 11 December 2014

Euro

The euro rose against the dollar. The Germany foreign trade surplus rose up to 20.6 billion euro in October that exceeded traders’ expectations, relying on the 19.0 billion euro and surpassed the previous month results, fixing 18.6 billion euro. The US dollar profit-taking happened yesterday amid its overvalued. As a result, the euro with the US dollar rose to the level of 1.2447. Their growth attracted interest for sale, the pair returned to the support near 1.2330-1.2350. Then the pair grew above the resistance level of 1.2425-1.2445.

The support levels are 1.2405-1.2425, and the resistance levels are 1.2500-1.2520.

MACD is in a positive territory.

Trading recommendations

The resistance breakthrough will allow bulls to test the resistance near the 25th figure and its completion will increase the possibility of temporary "bottom" reaching and a larger correction. While the pair is trading below 1.2425-1.2445, the risks of the pair fall are preserved.

Pound

The British pound was in the different fluctuations against the dollar and finished the session with a small "profit." The investors’ attention will be focused on the October trade balance, the forecasts suggest a deficit reduction to 9.5 billion with the earlier 9.8 billion pounds. The US dollar decrease helped the pound to grow up and test the resistance at 1.5710-1.5730 that again could hold back the bulls attack. However, the decrease is used to attract interest for sale that keeps the chances of another resistance testing

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

MACD is in a positive territory.

Trading recommendations

Should the pair break the resistance we should expect growth to 1.5800-1.5820 and its completion will open the way to 1.5870-1.5890. While the pound is trading below 1.5730-1.5750, the risks of renewed decline are preserved.

Yen

The Japanese yen has grown against the dollar as investors’ risk appetite continues to weaken - Nikkei fell by 2.25%. The news showed the inflation slowdown in Japan, one of the indicators - the purchasing prices index on the Japanese corporations goods fell down to 2.7% y/y from 2.9% y/y in November that was in the range of forecasts. Bulls could not return and consolidate above 120.00-120.20, as we warned, it has led to the pair decline as a result of which it has tested the level of 117.95-118.15. Here the dollar was sold off and it recovered to the mark of 119.05-119.25 that successfully holds back the bulls’ attack. Then the pair fell below the level of 117.95-118.15.

The support levels: 117.95-118.15, and the resistance levels: 119.25-119.45.

The MACD indicator is in a negative territory.

Trading recommendations

While the pair is trading below 120.00-120.20, the chances of renewal decline are preserved, the growth and the pair ability to consolidate above will testify about the dollar return into uptrend.