EURUSD Analysis 9th November 2012 – Technical Update
(Friday 9th November afternoon update, Forex-FX-4x, London, UK)
- Euro/dollar has seen a resumption of the recent downside price action and near term trend. Stronger than anticipated Chinese output and retail sales data had the EUR/USD FX pair testing the 1.2800 area during earlier trading, but the key 200 SMA area (with previous structure support now seeing resistance) was never challenged.
- The 38.2% Fibonacci retrace level is now giving way on risk aversion flows, as renewed uncertainty over Greece, along with the heavily documented concerns around the “fiscal cliff” in the US dominate end of week trading sentiment. As previously highlighted, this level is aligned with prior resistance from late June.
- Initial support may come around the 1.2700 handle. Further to this, the daily 100 SMA, 50% retrace and previous daily resistance highs around 1.2635 are the near term downside levels, which could see some kind of buy side interest on any extended move lower.
- Offers are anticipated around today’s 1.2790 area range highs. Just under the 1/10/2012 1.2800 previous support swing low referenced above.
- In related Forex/FX markets cable has printed a fresh 2-month low at 1.5903. This has seen the EUR/GBP gain on the day; the euro/sterling is currently trading at 0.7987 after finding support at the 50% retrace level highlighted in our last update (see figure 3). The US dollar index is trading at fresh 2 month high @81.04.
- COT (Commitment Of Traders) data today shows the EUR FX (CME) net short position stands at 67K versus the previous weeks 58K. This is the fourth consecutive week the net non-commercial position has increased.
EURUSD Analysis (Daily Chart) Figure 1
EURUSD Analysis (4 Hour Chart) Figure 2
EURGBP Analysis (Daily Chart) Figure 3
Where is the Euro heading?
Will the EURUSD weakness continue?