Wanders lower after yesterday's trend move higher
The EURUSD has wandered lower in trading today with the volatility spike after PBOC news in the Asia-Pacific session.
Yesterday, the pair trended higher after breaking and staying above the 100 day moving average (currently at 1.10364), and extended up to the July high price at 1.1215 (the high reached 1.12128) before settling into the close. The move lower today, took the price to the lower trend line connecting lows from August 7 and August 11. Buyers have entered against the level on the 1st look as risk can be defined and limited. What is not all that great about the move lower is the pair corrected more than 50% of the trend move higher. This is indicative of a market that did not really "love" the move higher yesterday. The holding of the trend line is good news for buyers for the time being, but the market can go either way (watch that line) - especially after testing and hold the high from July yesterday.
Of course the data at 8:30 AM ET (Retail Sales +0.6% est, Ex auto and ex auto and gas at +0.4% est, Initial Claims 270K) will play a key role in the trading today. So wait it out and see if the bulls or the bears win from stronger or weaker data. The market is still unsure of Fed come September. Retail sales
ON the downside, the 100 day MA is the next key support. That level comes in at 1.1036. The 100 hour MA (blue line in the chart above) is also in that area at the 1.10399 level. KEY level to get and stay below if the US numbers are stronger.
On the topside, a weaker string of economic numbers has one goal...get above - and stay above - the July highs at 1.1215. If it can the 1.1277 will be the next upside target.