Forex forecast

EUR/USD Forecast: above the top of recent range

28.04.2014 14:30:33

With a light calendar behind, the European morning sees local currencies advancing strongly against the greenback, with the EUR/USD finally breaking above the top of the range that held for almost 2 weeks around 1.3860, now immediate short term support. News that a US pharmaceutical company had started deals to buy an UK rival by $100B was the kick start of current high yielders’ demand, along with the positive mood between stocks traders that keep local share markets in the positive side.

The EUR/USD 4 hours chart shows an increasing upward potential, with price showing a strong upward acceleration above its 20 SMA having found a floor past week in its 200 EMA; indicators in the same timeframe head higher above their midlines with a nice bullish slope and with plenty of room to extend in the upcoming hours. Nevertheless, the week is fulfilled with first line data, meaning investors may be a bit reluctant to push the pair higher.

Currently around 1.3870, the pair may continue advancing up to 1.3890 in the short term, where it will finally fill the weekly opening gap from 2 weeks ago. Above this last, next level to watch comes around 1.3920, probable top for the rest of the day. Below 1.3860 price may extend lower, eyeing then 1.3820/30 support zone.