The USD/JPY can grow to 104 | 04 August 2014

Euro

The Eurozone inflation slowed to 0.4% - it is an inexcusably low level compared with a target of the ECB in the region of 2%. Most likely, Mario Draghi will say again that a low inflation is not so bad and that consumers in times of stagnating incomes can only win. However, that it is only a short-term benefit, the head of the ECB is unlikely to announce.

The euro/dollar stays under pressure, but continues to trade above the low at 1.3367. The attempts to get back above the 34th figure were unsuccessful, but the EUR/USD oversold may lead to the upward correction.

The support levels are 1.3400- 1.3420, and the resistance levels are 1.3480 - 1.3500.

MACD is in a negative territory.

Trading recommendations

We expect a correction now and advise to take profit at the support levels. The correction can either be on the current levels or after the 33rd figure testing. The traders who are not concerned about the risks could take the long positions.

Pound

The Markit Economics released a manufacturing sector PMI report. This indicator refers to the leading indicators and needs for trading after the release. The United States labor market publication will support the demand for the American currency.

The pound/dollar has broken the rising support line, failed to return above it, and, once again came under the pressure, having renewed the decline. As a result, the support was broken in the 69th figure area and the pound fell to a level of 1.6857.

The support levels are 1.6765 - 1.6785, and the resistance levels are 1.6850 - 1.6870.

MACD is in a negative territory.

Trading recommendations

The pressure on the pound still persists and in the short term, it may consolidate below 1.6850, and in case of its break - the 68th figure.

Yen

A series of negative macroeconomic statistics from Japan on the one hand and strong data from the United States on the other hand pointed out the further USD/JPY upward movement. The trading was within a narrow range of 102.70 - 103.00. We expect the price go down to the lower range boarder.

The dollar/yen continues to show a positive trend despite the stock indexes sharp drop. With the levels number break the outlook has improved significantly, and it may well test the resistance in the 104th figure.

The support levels: 102.10 - 102.30, and the resistance levels: 102.70- 102.90.

The MACD indicator is in a positive territory.

Trading recommendations

It is better to stay away from the market. The price is unpredictable right now.