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EUR/USD Technical Analysis - EUR/USD Trading: 2018-02-16
Improving euro-zone economic data bullish for euro
Improving euro-zone industrial production and falling French unemployment are bullish for euro. Will the EURUSD continue rising?
Euro-zone industrial production increased at a 0.4% rate in December, above the 0.1 % expected rate, according to Eurostat. Another positive news for euro-zone was the news France's unemployment rate fell below 9% at the end last year for the first time in almost nine years, according to the country's statistics agency Insee. Also new car sales in the European Union rose in January, as demand grew in all major EU markets except the UK, according to the European Automobile Manufacturers' Association. Positive euro-zone data are bullish for euro.
On the daily timeframe EURUSD is retracing after it pulled back to 1-month low a week ago.
- The Donchian channel indicates uptrend: it is tilted up.
- The MACD indicator is above the signal line and the gap is widening, which is a bullish signal.
- The Parabolic indicator gives a buy signal.
- The stochastic oscillator has breached into the overbought zone, this is a bearish signal.
We believe the bullish momentum will continue after the price breaches the above upper Donchian boundary at 1.25475. A price point above that level can be used as an entry point for a pending order to buy. The stop loss can be placed below the lower Donchian bound at 1.221. After placing the pending order the stop loss is to be moved every day to the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets the stop-loss level (1.221) without reaching the order we recommend cancelling the order: the market sustains internal changes which were not taken into account.
Technical Analysis Summary
| Position | Buy |
| Buy stop | Above 1.255 |
| Stop loss | Below 1.221 |
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