Previous Story
Euro Edges Lower as Momentum Turns Negative
The dollar received a boost during the latter stage of the Jackson Hole central bankers conference which rekindled the potential for a September Fed hike. Better than expected inflation data in EU also dampened hopes that the ECB will extend its ongoing QE program at Thursday’s policy meeting. A higher than expected Eurozone HICP reading for August are offsetting the picture and Eurozone stocks are heading for the worst month since 2011.
Inflation data came in stronger than expected in Europe although it remained stable and will be offset by declines in crude oil prices which should continue to make it difficult for the ECB to determine the real effects of inflation. European Stocks have been hindered by volatility induced by a 26% decline in the Shanghai over the past two weeks, which have boosted yields and whipsawed the Euro.
The EUR/USD currency pair tested short term resistance at the 10-day moving average near 1.1287, but failed to make a higher high and appears to be forming and inside day. Short term support is seen near Friday’s lows at 1.1155. Momentum has turned negative as the MACD (moving average convergence divergence) index generated a sell signal. The spread has crossed below the 9-day moving average of the spread confirming the sell signal.
The post Euro Edges Lower as Momentum Turns Negative appeared first on Forex Circles.
