The Euro holds in red in early Wednesday’s trading and pressures key support at 1.2205 (09 Feb low), maintaining bearish near-term bias. The pair fell on Tuesday after weaker than expected German inflation numbers and testimony of Fed Chairman Powell, which inflated dollar. After markets digested the comments, the Fed looks more hawkish than initially estimated, which prompted investors into fresh dollar longs, putting the single currency under increased pressure. Bearish acceleration on Wednesday broke below four-day congestion and generated bearish signal. Wednesday’s long red daily candle weighs for further weakness and attack at key supports at 1.2205 and 1.2173 (Fibo 38.2% of 1.1553/1.2555 rally, reinforced by rising 55SMA), violation of which would also trigger a number of stops parked below and spark fresh bearish acceleration, which could extend towards psychological 1.20 support (reinforced by rising 100SMA). Bearish setup of daily studies supports the notion, however, the pair may show stronger hesitation at 1.2205/1.2173 support zone, as daily slow stochastic broke into oversold territory. Upticks are expected to provide better selling opportunities and should remain below 1.2330/40 zone where daily MA’s formed double bear-cross (10/20 and 10/30). Today’s calendar is full, with German jobs data, EU CPI and US Q4 GDP eyed for fresh signal. German labor sector remains stable with unemployment expected to stay unchanged at 5.4% in Feb, but forecasts show significant fall in a number of unemployed people in Feb. Inflation in the Eurozone is expected to tick lower in Feb (1.2% f/ vs 1.3% in Jan).
Res: 1.2241, 1.2260, 1.2285, 1.2340
Sup: 1.2205, 1.2173, 1.2148, 1.2088
, maintaining bearish near-term bias. The pair fell on Tuesday after weaker than expected German inflation numbers and testimony of Fed Chairman Powell, which inflated dollar. After markets digested the comments, the Fed looks more hawkish than initially estimated, which prompted investors into fresh dollar longs, putting the single currency under increased pressure. Bearish acceleration on Wednesday broke below four-day congestion and generated bearish signal. Wednesday's long red daily candle weighs for further weakness and attack at key supports at 1.2205 and 1.2173 (Fibo 38.2% of 1.1553/1.2555 rally, reinforced by rising 55SMA), violation of which would also trigger a number of stops parked below and spark fresh bearish acceleration, which could extend towards psychological 1.20 support (reinforced by rising 100SMA). Bearish setup of daily studies supports the notion, however, the pair may show stronger hesitation at 1.2205/1.2173 support zone, as daily slow stochastic broke into oversold territory. Upticks are expected to provide better selling opportunities and should remain below 1.2330/40 zone where daily MA's formed double bear-cross (10/20 and 10/30). Today's calendar is full, with German jobs data, EU CPI and US Q4 GDP eyed for fresh signal. German labor sector remains stable with unemployment expected to stay unchanged at 5.4% in Feb, but forecasts show significant fall in a number of unemployed people in Feb. Inflation in the Eurozone is expected to tick lower in Feb (1.2% f/ vs 1.3% in Jan).){kind=link}