Euro Pushed Through Resistance Following Positive Sentiment Data


EUR/USD surged higher to a 1.1113 two-week peak, after surging passed resistance near the 20-day moving average at 1.1019. The high was logged in the immediate wake of the above-forecast German IFO report. The euro has also clocked two-week highs versus sterling and the yen. Gains over the last week reflect an unwinding Grexit risk positioning. EUR/USD only briefly pierced the 50-day moving average at 1.1105.

German Jul IFO unexpectedly moved higher with the overall reading rising to 108.0 from 107.5 in the previous month. The expectations reading rose for the first time since March and it seems the Greek bailout deal has boosted future optimism, while the current conditions indicator also improved. The diffusion index rose to 9.0 from 8.0, mainly on the back of a rebound in manufacturing confidence, as well as a marked improvement in wholesale trade.

The EUR/USD sliced through trend line resistance created from the highs in June and the highs in July and coming in a 1.1050. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a buy signal. This occurs as the spread (the 12-day moving average minus the 26-day moving average) crosses above the 9-day moving average of the spread. The index moved from negative to positive territory confirming the buy signal.

The post Euro Pushed Through Resistance Following Positive Sentiment Data appeared first on Forex Circles.

Source:: Euro Pushed Through Resistance Following Positive Sentiment Data

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