Good day forex traders and readers.
I hope everyone is up and ready this early of the new forex trading week. Did you have a good weekend? I hope you did!
In the previous EUR/USD forecast we noted that the 1.36 line remained our resistance for any bullish momentum. In fact as the previous week came to a close, bullish momentum was facing much drag. The fundamental uncertainty is high this week as the markets await the outcome of October 17.
Looking at the EUR/USD 4 hourly chart above we note that the currency pair remains somewhat tight in it’s trading range. 1.36 remains as our reference point for any further bullish action.
The chart above indicates that we can use the bollinger bands as a reference to a certain extent. Hence forth we are looking at the middle bollinger band as an immediate support. Further support will probably be 1.3500 in the event of any extended bearish push.
From a fundamental point of view, the Sunday meetings of the US government brought about no conclusion. As the shutdown continues and the debt ceiling deadline draws closer, there are still pockets of officials who see no urgency in resolving the issue. It was reported that the Chinese media are calling for a new international reserve currency so as to avoid future fallouts from the intensifying US political shootouts.
The IMF managing director Christine Lagarde warned of the global effects of not raising the debt ceiling limit. A possible tip over back to recession may happen.
With only 3 more days, do you think the US will get it’s act together? Let me know in the comments below. Trade safely.