EUR/USD Hits 1.1278, What’s Next?
The EUR/USD pair surged to a daily high of 1.1278, trading within a range and still confined in a daily triangle.
In short term, the upward momentum is fading in the 1 hour chart, as despite the price is well above its moving averages, the technical indicators are beginning to show signs of exhaustion near overbought territory.
In the 4 hours chart the 20 SMA is now aiming higher around 1.1200, whilst the Momentum indicator turned south and is crossing now below its 100 level, whilst the RSI indicator stands flat around 58, all of which limits chances of additional gains, during the upcoming hours.
Elsewhere the dollar edged sharply lower across the board, led by a sharp advance in commodities prices, as gold hovered in the 1,150 region, whilst WTI surged above $48.00 a barrel, for the first time in over a month.
Additionally, the price is getting too close to the vortex of the figure, and it will be invalidate if it’s not broken during the next couple of days. For this Wednesday, the roof of the figure is set at 1.1285, whilst the base stands now at 1.1160.
Data showed that in Germany, Factory orders were down 1.8% in August compared to July, and that the US trade balance deficit that widened to $48.3B in the same month, the largest expansion in US deficit in five months. The news boosted local share markets as sagging exports should put additional pressure on a FED’s possible rate hike.