The US dollar rapidly started losing ground as soon as the US trading session opened, even in the absence of economic reports and news flow. It is unclear what caused such a massive sell-off. One might attempt to link it to calls in the Arab world to impose an embargo on oil supplies to Israel, but the issue is that oil prices also dropped yesterday. It appears to be a significant speculative attack. However, the problem with such theories is that there is never any concrete evidence to support them, and such an explanation seems quite stretched. So, we just have to acknowledge the dollar’s broad weakness.
The only good thing is that this only happens in the absence of news and economic reports. Fortunately, we have a good amount of releases today. Preliminary business activity index estimates are being published across the board. In Europe, all the PMIs are expected to rise without exception, while in the United States, they are projected to decrease. So, logically speaking, the US dollar will continue to lose ground. However, given that it already experienced significant weakness yesterday, the potential to lose more would be quite limited. Considering the nature of today’s releases, a rebound with some correction is highly unlikely. In other words, the market will probably consolidate around yesterday’s reached levels.
The EUR/USD started the new trading week significantly higher, with it surpassing the resistance area of 1.0600/1.0620. As a result, the euro’s exchange rate increased by approximately 0.8%.
On the 4-hour chart, the RSI is showing movement in the overbought zone. This technical signal suggests an excessive amount of long positions on the euro.
On the same time frame, the Alligator’s MAs are headed upwards, which corresponds to the price’s direction.
Outlook
The euro is already overbought in the intraday period. However, in case it proceeds with the current momentum, speculators may choose to ignore this technical signal. In this scenario, the pullback may be delayed, and the currency rate could continue to rise.
In terms of the complex indicator analysis, we see that in the short-term and intraday periods, the indicators are reflecting an upward cycle.
The material has been provided by InstaForex Company – www.instaforex.com
The US dollar rapidly started losing ground as soon as the US trading session opened, even in the absence of economic reports and news flow. It is unclear what caused such a massive sell-off. One might attempt to link it to calls in the Arab world to impose an embargo on oil supplies to Israel, but the issue is that oil prices also dropped yesterday. It appears to be a significant speculative attack. However, the problem with such theories is that there is never any concrete evidence to support them, and such an explanation seems quite stretched. So, we just have to acknowledge the dollar’s broad weakness.
The only good thing is that this only happens in the absence of news and economic reports. Fortunately, we have a good amount of releases today. Preliminary business activity index estimates are being published across the board. In Europe, all the PMIs are expected to rise without exception, while in the United States, they are projected to decrease. So, logically speaking, the US dollar will continue to lose ground. However, given that it already experienced significant weakness yesterday, the potential to lose more would be quite limited. Considering the nature of today’s releases, a rebound with some correction is highly unlikely. In other words, the market will probably consolidate around yesterday’s reached levels.
The EUR/USD started the new trading week significantly higher, with it surpassing the resistance area of 1.0600/1.0620. As a result, the euro’s exchange rate increased by approximately 0.8%.
On the 4-hour chart, the RSI is showing movement in the overbought zone. This technical signal suggests an excessive amount of long positions on the euro.
On the same time frame, the Alligator’s MAs are headed upwards, which corresponds to the price’s direction.
Outlook
The euro is already overbought in the intraday period. However, in case it proceeds with the current momentum, speculators may choose to ignore this technical signal. In this scenario, the pullback may be delayed, and the currency rate could continue to rise.
In terms of the complex indicator analysis, we see that in the short-term and intraday periods, the indicators are reflecting an upward cycle.
The material has been provided by InstaForex Company – www.instaforex.com
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