EUR/USD: Technical and fundamentals aligned

by Admin

With markets closed on Easter holidays around the world today, there’s little to expect from markets. Majors consolidate in tight ranges due to the lack of volume, and is highly unlikely price will move far from current levels. Week is set to close with the EUR/USD trading below the 1.2880 level, with Cyprus under capital controls and Italy without a government. And the ECB will meet next week to set their economic policy: is there any chance they can rebuild confidence? Seems not possible: OTM announcement back in July 2012 triggered a strong wave of optimism that has now faded away. Draghi has little or nothing to offer to change current negative sentiment over the common currency. If something, the pair may remain ranging as investors will stay cautious ahead of the Central Bank.

But technical and fundamentals are aligned towards further EUR/USD slides: 1.2660 past November low, comes as probable target for next week, while if the level gives up, there’s scope for a test of the 1.2410 area. Recoveries should be understood as corrective, and strong selling interest will likely cap the pair at 1.3000. 

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