The pair started this trading week without the gap, trading near the upper limit of the ascending channel. The US data which is scheduled for the release today will determine further direction of movement in the currency. It is expected that capacity utilization rate will increase up to 78.1%, volume of industrial output will grow by 0.5%, pending sales in the secondary housing market will also grow by 0.5%. Technical analysis confirms probability of the rise in the USD and the decline in the pair up to the limit of the channel (1.3428), which is near the bottom line of “Bollinger bands” indicator.
Levels of support and resistance
The nearest support level is the moving average of “Bollinger bands” (1.3626), breakdown of this level will enable further decline to the level of 1.3428.
As a trading strategy I would recommend to open short positions with the target of 1.3626. If this level is broken down, it makes sense to place stop-loss order in the break-even zone and wait for the decline up to the level of 1.3428.
Analyst of LiteForex Group of CompaniesPublication source