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EURUSD Forex Trading Signals, March-April 2015

TCI Forex Trading Signals: EURUSD March-April 2015

“Never Trade against a Major Central Bank”

Market: Foreign Exchange

Asset: EURUSD

Forecast: EURUSD downtrend continuation (↓) after a short-term uptrend correction

EURUSD Outlook

If there is one constant rule when trading Forex, this rule is “Never trade against the will of a Major Central Bank”. Major Central Banks such is the FED, ECB, SNB, and BoJ are holding a lot of cards under the table and are always willing to manipulate their currencies according to their long-term monetary strategy. In this current Forex Market, the only major central bank that does not have a problem seeing its currency moving higher is the FED. ECB and BoJ are both focusing on flexible monetary policies in a last attempt to see their economies grow again. On the other hand, the US economy is growing, US unemployment is shrinking and a hard-currency policy is on the way as the US rates are expected to start rising in the second half of 2015. In such a dynamic environment the US Dollar is expected to move even higher against the Euro and the Japanese Yen in the next few months. We shall probably see EURUSD trading at 1:1 in the next couple of months.

But as the Euro against the USD is trading near the 12-year low and as USD has gained about 10% against the EUR in only one month we shall examine if this is the time for a temporary Euro correction against the USD. According to TCI, the EURUSD is an oversold market as TCI reading reached again -11% as in the case of our previous EURUSD trading signal in February 2015. By the time of this analysis, EURUSD is trading at 1.0560. Given the neutral news, EURUSD can move to 1.0650 and even at 1.0750.

Evaluating Our Previous Trading Signal

In our previous trading signal, we have indicated that during 2015 we shall expect nothing more than an aggressive USD appreciation against the European Currency. By that time EURUSD was trading at 1.13 and we said “Short reaction may lead EURUSD a little bit higher (maybe to 1.15) but it seems that it is a pure technical reaction” and we noted also that “In this volatile environment EURUSD is expected to start a new downtrend in the following weeks”. Actually, EURUSD moved to exactly 1.15 and then begun a new strong downtrend. Today EURUSD is trading at about 1.0560. This is a huge move only in a few weeks.

» Forex Trading Signals: EURUSD, USDJPY. GBPUSD -February 2015

EURUSD Technical Analysis

Euro against the US dollar is trading close to the 12-year low. Here are some important EURUSD support and resistance levels.

Strong Support / Demand Level: 1.0550-1.0450 | 1.0350-1.0300 | 1.0030-1.0000 | 0.9650

Strong Resistance / Supply Level: 1.0600-1.0650 | 1.0750 | 1.0900 | 1.1030

EURUSD March 2015

TCI on EURUSD

Here are the current TCI Indications regarding EURUSD.

TCI during March 11th, 2015 indicated EURUSD at -11.25%. This is a clear sign that the EURUSD market is oversold in the short-term and an upward correction is possible. EURUSD exchange rate target at 1.0650 and up to 1.0750.

Table: TCI on EURUSD

Date

Close

High

Low

Volume

Change %

Volatility

TCI

2015.02.27

1.11951

1.12441

1.11748

126535

-0.01%

0.6%

-4.41%

2015.03.02

1.11823

1.12397

1.11581

100982

-0.11%

0.7%

-4.11%

2015.03.03

1.11752

1.12166

1.11534

110876

-0.06%

0.6%

-4.51%

2015.03.04

1.10771

1.11845

1.10605

111084

-0.88%

1.1%

-5.76%

2015.03.05

1.10274

1.11136

1.09864

120759

-0.45%

1.2%

-5.31%

2015.03.06

1.08426

1.10316

1.08386

89773

-1.68%

1.8%

-8.92%

2015.03.09

1.08496

1.09056

1.08209

79099

0.06%

0.8%

-8.05%

2015.03.10

1.06776

1.08538

1.0667

82504

-1.59%

1.8%

-10.62%

2015.03.11

1.05437

1.07158

1.05104

152836

-1.25%

2.0%

-11.25%

2015.03.12

1.0623

1.06831

1.04931

149162

0.75%

1.8%

-9.05%

2015.03.13

1.04933

1.0634

1.04613

128497

-1.22%

1.7%

-10.93%

2015.03.16 (MID-DAY)

1.05638

1.06157

1.04775

89135

0.67%

1.3%

-10.43%

(+1 Trading Days)

         

-8.96%

(+2 Trading Days)

         

-8.56%

(+3 Trading Days)

         

-8.55%

(+4 Trading Days)

         

-8.04%

(+5 Trading Days)

         

-8.61%

(+6 Trading Days)

         

-7.84%

(+7 Trading Days)

         

-8.07%

(+8 Trading Days)

         

-7.34%

(+9 Trading Days)

         

-6.52%

(+10 Trading Days)

         

-6.23%

(+11 Trading Days)

         

-6.44%

(+12 Trading Days)

         

-6.52%

(+13 Trading Days)

         

-6.22%

(+14 Trading Days)

         

-5.86%

(+15 Trading Days)

         

-5.54%

EURUSD Important News and Updates

These are some important news and updates regarding EURUSD.

 

□ According to the latest EUR/USD forecast from Goldman Sachs, the pair is expected to trade at 1.020, 1.000 and 0.950 in 3, 6 and 12 months respectively.

 

□ US Industrial production rose less than expected during February 2015. According to the Federal Reserve, the US industrial production rose 0.1% seasonally adjusted in February below the expectations for 0.2%. The US industrial production for January 2015 was also revised down.

□ The US manufacturing production declined 0.2% (seasonally adjusted) in February 2015 despite the forecast for a 0.1% increase.

□ The US retail sales report showed US retail sales shrinking 0.6% in February 2015, the forecast was 0.3%.

□ The US unemployment rate in February 2015 declined to 5.5% from 5.7%.

□ The National Association of Home Builders in a recent report announced that the Housing Market Index dropped to a 7-month low of 53.0 in March 2015 compared to 55.0 in February 2015. Note that in general, levels above 50.0 are indicating a favorable outlook on US home sales.

□ The ECB quantitative easing program is in full swing.

□ The Euro interest rate remained at 0.05%.

□ The Eurozone CPI (YoY) in February 2015 at -0.3%, better than expected (forecast -0.4%).

□ The European stocks are rallying as the Euro moves lower against the other majors and exporting countries such is Germany are growing expectations. Be aware that a short-term bubble is formed there and a strong correction is close and inevitable.

 

□ A member of the ECB Governing Council (Ignazio Visco), told in a recent conference that EUR has dropped faster than expected.

 

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Free Forex Trading Signals: EURUSD

George M. Protonotarios, Financial Analyst

for Trading Center (March 16th, 2015)

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