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EURUSD Facing Trend Line Resistance

Key Points

  • Euro gained bids recently against the US dollar to trade as high as 1.1218 before it found sellers.
  • The EURUSD pair is currently moving down, as there is a bearish trend line formed on the hourly chart, which is acting as a resistance for more gains.
  • Italian Consumer Price Index released by the Istat posted a decline of 0.2% in Feb 2016, just as the market expected.
  • Euro Area Employment Change released by the Eurostat posted a change of 0.3% in Q4, better than the forecast of 0.2%.

Technical Analysis

The Euro enjoyed a good ride against the US dollar and traded above the 1.1200 resistance area. However, it failed to retain the bullish tone, and started to move down. There is a bearish trend line formed on the hourly chart of the EURUSD pair, which acting as a catalyst for the downside move.

EURUSD

The pair is currently finding bids near the 100 hourly simple moving average and the 38.2% Fib retracement level of the last leg up from the 1.0823 low to 1.1218 high.

A break below the 100 MA may take the pair towards the 200 SMA. On the upside, the trend line remains a resistance.

Euro Area Employment Change

Today, the Euro Area Employment Change, which is a measure of the change in the number of employed people was released by the Eurostat. The market was expecting a change of 0.2% in Q4 2015, compared with the last quarter. However, the result was above the forecast, as the change was 0.3%.

The report added “compared with the same quarter of the previous year, employment increased by 1.2% in the euro area and by 1.0% in the EU28 in the fourth quarter of 2015 (after +1.1% and +1.0% respectively in the third quarter of 2015)”.

Overall, the EURUSD may struggle to trade higher as long as it is below the highlighted trend line and resistance area.

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