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EUR/USD Outlook: Euro Loses Traction After Weaker Than Expected German Ifo Data

The Euro fell to the session low in European trading on Monday, down over 40 pips, deflated by weaker than expected German Ifo data, which dropped to the lowest since April in October.

Fresh weakness hit the floor of multi-day congestion (1.1620) increasing the risk of reversal after recovery from 1.1524 low was repeatedly rejected under key Fibo barrier at 1.1671 (38.2% of 1.1909/1.1524 fall).

Mixed daily studies (10/20DMA bull-cross/momentum still in positive territory conflict falling 30/55DMA’s/RSI and stochastic heading south) lack a clear direction signal for now.

Close below 1.1620 would generate an initial negative signal which would require confirmation on the return and close below 20DMA (1.1599) which would increase the risk of retesting key support at 1.1562 (weekly cloud base).

On the other side, an eventual close above falling 30DMA (1.1646) which capped the action during the last week, would ease downside risk, but a sustained break of 1.1671 Fibo level would signal bullish continuation.

Traders eye ECB meeting on Thursday, expecting more hawkish tones from the central bank regarding the possibilities of tapering start and possible earlier than an expected rate hike.

Res: 1.1646, 1.1671, 1.1707, 1.1716.
Sup: 1.1615, 1.1599, 1.1571, 1.1562.

Windsor Brokers Ltd
Windsor Brokers Ltdhttp://www.windsorbrokers.com/
The information contained in this document was obtained from sources believed to be reliable, but its accuracy or completeness cannot be guaranteed. Any opinions expressed herein are in good faith, but are subject to change without notice. No liability accepted whatsoever for any direct or consequential loss arising from the use of this document.

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