The EURUSD pair bounced very sharply above the 1.3820 level during the last week, as the ECB decided not to reduce the interest rates. The ECB President Mario Draghi was also a little less dovish this time. This resulted in a rally for the pair. I think the pair does want to go higher and trade above the 1.40 level in the short term. So, we should look forward to buying any retracements in the pair.
There is an up-move trend line, as can be seen in the 4 hour chart shown below. There are many supports at around the 1.3780/60 levels, which also coincides with the trend line. If the pair pushes a bit lower from the current levels, stops around the mentioned levels and forms a bullish divergence on the lower timeframe, then we can jump into a buy trade.
Initial target should be around the 1.3950 level, and final target could be above the 1.40 level. Stop should be placed below the trend line and support region.
Major events scheduled in the upcoming week
The US dollar sellers were seen very aggressive during this past week, as the US dollar registered a healthy slide. The pairs such as EURUSD, NZDUSD and AUDUSD traded higher during the last week. The EURUSD managed to climb above the previous high of 1.3890, and the AUDUSD traded above the 0.9100 level. The NZDUSD also spiked above the 0.8500 figure during the last week. The BOE and ECB kept the interest rates unchanged during the last week’s meeting. Furthermore, the US NFP figures jumped higher, as it registered a reading of 175K, which is a lot higher than the expectations. This resulted in a relief rally for the US dollar on the Friday.
Let us look at all major events lined up in the upcoming week.
Sunday – Japan’s GDP data.
Monday – French industrial production, Spanish CPI data, Italian industrial production data and Australia’s NAB business confidence.
Tuesday – German trade balance data, UK manufacturing production, UK industrial production and Australia’s home loans data.
Wednesday – UK trade balance data, Euro zone industrial production, US federal reserve balance, RBNZ interest rate decision and Australia’s jobs report.
Thursday – Chinese industrial production, US jobless claims, US retail sales data and Japan’s industrial production data.
Friday – Swiss PPI data, US PPI data and Michigan consumer sentiment.
This analysis is taken from Weekly Market Forecast, which also includes trade opportunities on: GBPUSD, EURCAD, GBPCAD, EURCHF, AUDUSD, NZDUSD, AUDNZD, AUDJPY, OIL, GOLD and INDICES.
Get it HERE: Vladimir’s Markets Forecast
Enjoy the weekend friends!
