FXStreet (Guatemala) – Valeria Bednarik, chief analyst at FXStreet explained that the American dollar ended the week sharply higher against all of it major rivals, helped by plummeting gold´s prices, and renewed fears of a Chinese economic slowdown.
Key Quotes:
“The EUR/USD pair closed the week below the 1.0600 level, the lowest since March, ahead of crucial macroeconomic events that will take place this week, including an ECB economic policy meeting, and the US Nonfarm Payroll report. The ECB has largely anticipated that it will review the QE extension in December, but last week, markets’ talks pointed also for further negative deposit rates. The common currency traded as low as 1.0567 last Friday, holding a couple of pips above its recent 7-month low, but maintaining the strong bearish tone.
For this week, the pair will clearly depend on macro figures, and how market’s players understand them. But as long as the imbalance between Central Banks keeps widening, the risk will remain towards the downside, with a possible test of this year high during the upcoming days.
Technically, the 4 chart shows that the technical readings remain in bearish territory, albeit lack directional strength at the time being, with the 20 SMA offering an immediate resistance around 1.0620. In the daily chart, the 20 SMA maintains a strong bearish slope above the current level, whilst the Momentum indicator heads south below the 100 level and the RSI indicator hovers around 29, in line with the shorter term outlook.”
(Market News Provided by FXstreet)