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Market View

Trump and May Sink USD, While EURUSD Recovers

Wednesday, January 18, 2017 4:31 AM GMT

Theresa May’s speech offered a thrilling day for traders yesterday. The GBP increased almost 3 percent against USD, the biggest daily gain since at least 1998, which squeezed most of sellers that made lot of money due GBP fall. While Trump’s comments on The Wall Street Journal were enough to sink the USD.

"Our companies can't compete with them now because our currency is too strong. And it’s killing us," Trump told The Journal, referring to competition from China.

All the above market conditions pushed EURUSD higher reaching the level 1.07. The pair is on short-term “correction phase “as USD continues to be on “recovery more” towards CPI news today. 

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Technical View

Reviewing EURUSD on daily timeframe, we have used Andrew’s pitchfork, which can give us the direction of the trend as well as support and resistance lines. The 5 EMA remains above 20 EMA and also there is a bullish crossover by 5 EMA to 50 EMA. Therefore, the mid-term trend bias keeps the positive momentum and possible buying opportunities may occur.  Major resistances on 1.071 and 1.085 while supports on 1.063 and the MAs like 20 EMA or 50 EMA.

 EURUSD Daily


(EMA = Exponential Moving Average, SMA= Simple Moving Average
5EMA=Purple, 20 EMA=Gold, 50 EMA=Green, 200SMA= Blue)

Heading lower on hourly timeframe, the trend bias is bullish as most of MAs keep the uptrend crossovers. As long as the grey zone is holding the price above, the bias is positive for buyers and may offer good probabilities for long trading setups. On the other hand, if there is a violation of this zone, then sellers will have the advantage. 

 EURUSD Hourly


(EMA = Exponential Moving Average, SMA= Simple Moving Average
5EMA=Purple, 20 EMA=Gold, 50 EMA=Green, 200SMA= Blue)

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