The euro is again under pressure | 03 December 2014

Euro

The Euro zone economic data did not show good results, but it did not prevent the dollar from growing against the euro at the end of the trading day. The Eurozone producer price index (PPI) for October is expected to be in the negative dynamics for month, -0.3% m/m vs. + 0.2% m/m in September and with a slight improvement for year, -1.3% y/y after the earlier-1.4% y/y. The inflation topic is now the most important for the European bloc and the indicator results can cause the volatility spike on the market.

The pair found the support near 1.2405-1.2425 and it rose to the resistance near the 25th figure. After its testing it rebounded below the support near 1.2405-1.2425.

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

If the euro manages to consolidate below 1.2420 the 23th figure will again be tested and its breakthrough will open the way to the 22nd figure. The loss of the support level of 1.2330-1.2350 will lead to the euro decrease further to 1.20.

Pound

The pound decreased at the yesterday session. Earlier the British pound has grown more confidently among all majors against the dollar. The Purchasing Managers Index (PMI) for the manufacturing sector rose in November and showed the level of 53.5, but was forecasted to fell down to 52.8 after it was fixed at the level of 53.3 in October. We expect the November Purchasing Managers Index (PMI) for the construction sector. In this case, it is forecasted slow activity - from 61.4 to 61.1.

Bulls try to take over the bears’ initiative. Taking the pair away from the support near the 56th figure, they tested 1.5730-1.5750, but failed to overcome it. As a result the pair rebounded downwards below the support level of 1.5630-1.5650.

The support levels are 1.5580-1.5600, and the resistance levels are 1.5650 - 1.5670.

MACD is in a neutral territory.

Trading recommendations

The pair changed its mind and decided to continue falling against growing. The pair may reach 1.56 soon. Should the pair consolidate at this level it may go further to 1.5530.

Yen

The US dollar came under pressure with the pair USD / JPY amid the Japan's sovereign debt downgrade to the level of "A1" to "Aa3". The Japan news published the data about the monetary base changes in November, the information showed a reduction to 36.7% y / y from 36.9% y / y against the forecast to see an increase to 37.2% y/y. The USD/JPY showed a negative trend. The pair fell to the support near 117.95-118.15, but the pair demand on the lows is still preserved and it is again approaching to the 119th figure.

The support levels: 117.95-118.15, and the resistance levels: 119.05-119.25.

The MACD indicator is in a positive territory.

Trading recommendations

Bulls count on the level testing of 120.20-120.40, to achieve this target they will have to overcome the resistance at the level of 119.20-119.40. The yen inability to overcome it could trigger profit-taking and the downward correction development.