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    IronFX Essential Intraday Comment | 24/07/2015

    • The dollar traded unchanged or higher against most of its G10 peers during the European morning Friday. It was higher against EUR and GBP, in that order, while it was lower vs AUD. The greenback was virtually unchanged against JPY, NZD, SEK, CAD, CHF and NOK.

    • EUR weakened after the French preliminary PMIs for July fell below expectations and the manufacturing PMI fell back below 50. The single currency continued to tumble after the German and Eurozone figures were announced, as the data showed a modest slowdown in economic activity in the second half of the year. Nevertheless, I would be cautious about these results as the deteriorating economic conditions could be attributed to the uncertainty caused by the Greek crisis. Therefore, I would prefer to wait for the next month’s figures to be convinced that the bloc is losing its recovery momentum.

    • EUR/JPY traded lower during the European morning Friday following the soft PMI data from Eurozone. However, the decline was halted near the 135.50 (S1) barrier. Since the 20th of July, the price structure has been suggesting a short-term uptrend, but I see the likelihood that the current setback may continue for a while. A break below the 135.50 (S1) line could open the way for a test of the psychological obstacle of 135.00 (S2). Our short-term oscillators support the notion. The RSI fell below its upside support line and is now near its 50 line, while the MACD has topped and could fall below its trigger line soon. On the daily chart, the pair is still trading above the 133.30 support area, which stands marginally below the 50% retracement level of the 14th of April – 4th of June advance. As a result, although we may see further pullback in the short run, I would like to see a daily close below that area before I assume that the medium-term picture has turned negative.

    • Support: 135.50 (S1), 135.00 (S2), 134.40 (S3)

    • Resistance: 136.40 (R1), 137.20 (R2), 138.00 (R3)

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