The euro does not show much strength | 30 Maio 2014

Euro

The Monday is a bank holiday in the USA and the UK. The market activity can be low.

We expect some important economic data this week, mainly we expect the U.S. gross domestic product release. The Eurozone will publish the European Commission confidence indexes on Wednesday. The ECB President Mario Draghi will speak at the ECB forum in Portugal on Monday and Tuesday.

The experts forecast the data worse than the previous ones this week that could trigger a wave of dollar selling. If the forecast is proved it may lead to the pair correctional growth to the strong resistance level 1.3732.

The support levels are 1.3570-1.3590, and the resistance levels are 1.3620 - 1.3650.

MACD is in negative territory.

Trading recommendations

We see a classical formed a bearish divergence that can support the pair growth from the beginning of the trading week. We can close out deals at the resistance level 1.3691. The stop-loss can be placed at the resistance level 1.3732.

Pound

The UK's GDP reached the level of experts' forecasts and showed annualized growth of 3.1 %. However, the dollar growth pressured the pair GBP/USD at the end of the previous trading week. In general the pair GBP/USD closes above 1.6810 broken level that indicates a greater likelihood of growth resumption.

We expect consumer confidence index from Gfk this Friday.

The support levels are 1.6810 - 1.6830, and the resistance levels are 1.6900 - 1.6920.

MACD is in positive territory.

Trading recommendations

The pair’s falling can be limited by the support at 1.6732. We can place stop-loss orders at this level. We can buy the pound/dollar on the dips and rises above the resistance at 1.6857 and 1.6887. The growth target is a maximum 1.6920 and the resistance level 1.6995.

Yen

The USD/JPY showed a growth last trading week. The pair strengthening began immediately after the Bank of Japan press conference. The Central Bank decided to leave the monetary policy unchanged, the Japanese economy is showing recovery signs, the inflation target rate of 2 % will be achieved this year.

BoE will publish its last minutes from April 30th.

The support levels: 101.50-101.70, and the resistance levels: 101.80-102.00.

The MACD indicator is in neutral territory.

Trading recommendations

If the USD/JPY breaks the resistance level 102.36 we advise you to buy it. We can partial close buying orders after the pair reaching the maximum 103.00, the ultimate goal for the growth is the resistance level 104.11.