Technical Analysis EUR/USD for November 18, 2015
EUR/USD dropped to a fresh seven-month low of 1.0630. ECB board member Praet encouraged euro selling by saying in a Bloomberg interview that “there are risks and that is why we are considering further action.” The divergent policy stances of the ECB and Fed should continue to put downward pressure on the currency pair. Tuesday better than expected Zew survey failed to lift the currency pair. Support is seen near the March lows at 1.0470, while resistance is seen near the 10-day moving average at 1.0765. The only caveat is that the RSI is printing a reading of 28, below the oversold trigger level of 30 and could foreshadow a correction.
German ZEW investor confidence beat expectations, with the expectations reading jumping to 10.4 in November, from 1.9 in the previous month and easily beating our survey median of 6.1.The reading for current conditions eased to 54.4 from 55.2. The overall Eurozone reading meanwhile eased slightly to 28.3, but remains at relatively high levels.