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James Hyerczyk

After getting no help from the European Central Bank on Thursday, the Euro remains under pressure today with sights set on its August 15 bottom. Later today, traders will get the opportunity to react to the latest U.S. GDP data. The U.S. economy is expected to have grown at a 3.3 percent annualized rate in the third quarter, following 4.2 percent at the end of the second quarter.

At 1155 GMT, the EUR/USD is trading 1.1341, down 0.0034 or -0.30%.

On Thursday, ECB President Mario Draghi failed to convince traders the central bank could pursue monetary tightening after next summer as political and economic uncertainties grow in the monetary union.


Daily Technical Analysis

The main trend is down according to the daily swing chart. The next downside target is the August 15 bottom at 1.1301. The EUR/USD is in no position to change the trend to up, but it is in a position to post a closing price reversal bottom. This won’t change the trend, but it could lead to a 2 to 3 day counter-trend rally.

On the upside, the nearest resistance is a pair of old bottoms at 1.1432 to 1.1433 since old bottoms tend to make new tops.


Daily Technical Forecast

The EUR/USD is currently trading inside a downtrending channel. On the upside, the resistance comes in at 1.1395. As long as the Forex pair stays below this price, it should trend lower.

The channel points towards the bottom at 1.1301. The lower channel line points toward 1.1302 today. The upper channel line points towards a test of 1.1301 on October 30-31.

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