Daily Technical Outlook on EUR/USD: May 9, 2014

DAILY TECHNICAL OUTLOOK ON EUR/USD
Last Update At 09 May 2014       00:04GMT

Trend Daily Chart
Sideways

Daily Indicators
Bearish divergences

21 HR EMA
1.3872

55 HR EMA
1.3893

Trend Hourly Chart
Near term down

Hourly Indicators
Rising fm o/s

13 HR RSI
26

14 HR DMI
-ve

Daily Analysis
Consolidation with downside bias

Resistance
1.3952 - Tue's high
1.3905 - Y'day's Asian low (now res)
1.3890 - Mon's high (NZ)

Support
1.3812 - Last Fri's low
1.3771 - Last Wed's low
1.3736 - 50% r of 1.3477-1.3995


. EUR/USD - 1.3840.. Although euro briefly penetrated Mar's 1.3967 high to a fresh 2-year peak of 1.3995 (EBS) Thu after ECB kept rates unchanged, as usual , ECB President Draghi's comments that a rate cut is possible in Jun plus his concern on euro's strength at the press conference sent euro tanking to 1.3833.

. Looking at the daily picture, despite euro aforesaid rise to 1.3995, subsequent near term reversal fm there confirms MT uptrend has indeed formed a temporary top there as this lvl was accompanied by prominent 'bearish divergences' on the hourly & daily oscillators. Current price action suggests euro is at least correcting the intermediate rise fm 1.3672 (Apr low) or the up move fm 1.3477 (Feb), a 'minimum' 38.2% r of the latter move wud pressure the single currency to 1.3797 n then 1.3736 (50% r) later next week. Therefore, selling euro on recovery in anticipation of such move is recommended n only abv a daily close abv 1.3952 wud dampen present bearish scenario on euro.

. Today, euro has remained under pressure at Asian open, however, as hourly indicators' readings are in o/sold territory, further steep fall is unlikely to be seen in Asia n reckon 1.6812 n bring recovery b4 another decline.