EUR / USD – Returns to the Brick Wall at 1.31

Over the last three days, the Euro has bounced well off the support level at 1.29 only to run into a wall of supply around the 1.31 level.   The Euro fell sharply late last week after having pushed into the resistance level at around 1.31 and then been turned away back towards 1.29.   Prior to this fall over the last week, earlier last week the Euro surged through the significant key level at 1.30, however as expected, the previous resistance levels between 1.31 and 1.3150 loomed large with the former creating a brick wall and forcing the Euro back.  This surge higher however resulted in the Euro trading at a seven week high around 1.3125.

During last week, the Euro placed pressure on the resistance level at 1.31 however it held firm with excessive selling around the level, and we are seeing a repeat of this activity and subsequent price action presently.   Even if it was able to rally a little further and move beyond the resistance level at 1.31, the previous resistance around the 1.3150 area would likely play a role again and may place some doubt into the minds of buyers, yet again. (Daily chart / 4 hourly chart below)

daily chart

4 hourly chart

EUR/USD

Dec 12 at 21:55 GMT

1.3074 / 75

H: 1.3097

L: 1.2995

 

S3	S2	S1	R1	R2	R3
1.2900	1.2800	1.2700	1.3000	1.3100	1.3150

EUR/USD Long – Short Ratio

(Shows the ratio of long vs. short positions for the EUR/USD. The left percentage (blue) shows long positions; the right percentage (orange) shows short positions.)

EUR/USD Technical

• During the early hours of the Asian trading session on Thursday, the Euro is just easing away from the resistance level at 1.31 that it recently ran into.
• The 1.31 level emerged as a key level a couple of weeks ago when the Euro was strongly pushed away from it, and in the last few hours the Euro has again ran into a brick wall at this level.
• There are now several levels likely to offer support over the longer term should the Euro ease off from its present trading levels. Eg. 1.29, 1.28, and 1.27.
• Current range: Just below 1.31 around 1.3075.

 

Further levels in both directions:

• Below: 1.2900, 1.2800 and 1.2700.
• Above: 1.3000, 1.3100 and 1.3150.

 

December 13

• AU 0:30 (GMT) New motor vehicle sales (13th-19th) (Nov)
• CH 8:15 (GMT) Producer & Import prices (Nov)
• EU 10:00 (GMT) Labour Cost Index (Q3)
• CA 13:30 (GMT) House Price Index (Oct)
• US 13:30 (GMT) Initial Claims (08/12/2012)
• US 13:30 (GMT) PPI (Nov)
• US 13:30 (GMT) Retail Sales (Nov)

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