EUR/USD: Currency in Play for Next 24 Hours

By Kathy Lien (gftforex.com)
EUR/USD will be the currency in play for the next 24 hours. A vast array of European data is expected, which includes French Consumer Spending at 2:45 am ET or 7:45 GMT, the ECB Monthly Report at 4:00 am ET or 9:00 GMT, and EZ Industrial New Orders at 5:00 am ET or 10:00 GMT. Following these European events will be Housing Starts and Building Permits reported by the US at 8:30 am ET or 13:30 GMT.

EUR/USD has managed to stay in the Bollinger band sell zone for an impressive eight days. The sheer strength of the upswing encountered in the month of December has almost been completely countered. The retracement levels drawn from the October 28th lows to the December 18th high does a fairly good job at providing us with the most relevant levels. For support, we have seen prices fail the 78.6% retracement at 1.2839 for the second consecutive day. For resistance, we have the confluence of the 61.8% retracement, one-standard deviation Bollinger band, and the 10-day SMA. Since prices have not been able to break from the sell zone, it is likely that this level will be sufficient in pushing prices downward. A break of the 1.2839 support should see prices extend down to 1.2328, or the October 28th low.