The problem of the US budget is still unresolved; and the time is fast drawing near technical default. I would remind that Treasury Secretary Jacob Lew has announced that on 17 October the country can become a bankrupt. Today is the bank holiday in America, so the news that may cause the change in the rate of the currency is the publication of the data on industrial output in Germany. Analysts expect that the monthly rise in the index will amount to 0.8%; however, the annual value is likely to reduce by 2.1%.
Technical analysis show that on the four-hour chart there is a downward channel, the price is trading near its upper limit. MACD indicator demonstrates “bearish” divergence, suggesting that it is time to think about selling.
Support and resistance
Growth in the pair is prevented by the upper limit of the channel and the local lows of the price at 1.3581, which is near the upper moving average of the “Bollinger bands” indicator. The first support level is at 1.3535. Breakdown of this level will open the way to the lower limit if the channel at 1.3487.
It is recommended to open short positions with the target of 1.3487. Stop-loss can be placed at the level of 1.3581.
Analyst of LiteForex Group of CompaniesPublication source