Good day forex traders.
Did you have a good week of forex trading? I hope everyone made pips!
In the previous EUR/USD forecast we noted that the currency pair was bearish for the week. It stopped before the lower bollinger band as expected. Due to the usefulness of our bollinger bands technical approach, further price action might be influenced by it.
The immediate support would be 1.09 followed by 1.08. A bullish recovery would need to achieve resistance region of 1.12 followed by 1.14.
Looking at the EUR/USD weekly chart above we note that the currency pair was a doji for the week. Once again our bollinger bands worked!
The bearish momentum was rejected by the lower bollinger band and the EUR/USD had since eased up to 1.10. Considering this, the immediate support will likely remain at 1.09 followed by 1.08. The bullish target is likely at the resistance region of 1.12 followed by 1.14. Needless to say, all bollinger bands are potential areas of influence.
The FOMC statement released during the week was less dovish than before. The mention of global developments dampening the US economy was removed. Having said so it did acknowledge that it will continue monitoring international factors closely.
Investors and traders seem to have caught on to the speculation that the interest rate will rise in December and hence a knee jerk reaction probably occurred. The US dollar rose in value versus the euro currency. However we noted that the initial reaction waned towards the end of the week. This is not surprising considering the fact that the FOMC statement was a mixed bag after all.
Continue to pay close attention to major events such as the US Non-Farm Payroll due this week.