Vector Securities - Analytics

    Vector Securities

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    Durable goods orders turned the scale of multi-day confrontation

    In recent days all euro’s attempts to break through above 1.1400 have failed. The data on durable goods orders of the U.S.A. got it down yesterday. After several months of decrease, all components of the indicator showed growth at last. It allowed dollar to recapture the initiative along the wide front of currencies. EURUSD pair suffered most, its low boundary of multi-day range was broken through, what just strengthened the pressure on euro. Yesterday’s movement lays a good ground for renewed trend of dollar’s strengthening.

    Today preliminary data on inflation will be published in some countries of the Eurozone, first of all, in Germany. At the beginning of the week we presumed that they wouldn’t have much influence on the common currency, but now we have some doubts. After yesterday’s movement the negative on inflation can become an additional factor for pressure on euro. Technically, the pair reversed downward again, having broken through strong support level at 1.1270, and now it will react more readily to corresponding statistics. The second evaluation of US GDP for the 4th quarter, where downward adjustment is expected, can bring some uncertainty. But in current situation this should not become a problem for dollar.

     

    Trade tactics:

    The outcome of yesterday’s trades has dramatically changed the technical picture in EURUSD pair. Renewal of descending trend can be spoken about only after exit from the range with breakthrough of 1.1270 downward. The nearest aim is last minimum in the range 1.1100. Today we consider opening of short positions from 1.1230 – 1.1250 with the aim at 1.1100, stop at 1.1330. In case of a pair decrease of more than 30 points from the entry point, rearrange stop at the entry point.

     

    Any opinions, advice, news, research, analyses, prices or any other information presented on this webpage is provided as general market commentary and does not constitute investment advice. "Vector Securities" shall not be liable for any loss, including loss of profit, which may arise directly or indirectly from the use of this information.


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