Key Points
- The Euro has slowly and steadily moved down versus the US Dollar and currently trading near a short term support.
- There is a contracting triangle pattern formed on the hourly chart of the EURUSD pair, which is currently providing support.
- The German Factory orders was released by the Deutsche Bundesbank earlier today.
- The outcome was positive, as it posted a rise of 1% in August 2016, compared with the previous month.
EURUSD Technical Analysis
The Euro spiked sharply higher to trade near 1.1240 versus the US Dollar, but it found sellers. The main reason for the EURUSD pair to pause the upside was due to a contracting triangle pattern formed on the hourly chart.
The upper trend line of the highlighted contracting triangle pattern prevented the upside move on a number of occasions. As a result, there was a downside move.
On the downside, the contracting triangle pattern support trend line along with another trend line is protecting losses and acting as a support. The pair may even bounce soon from the highlighted support.
German Factory Orders
Today in the Euro Zone, the Factory orders, which is an indicator that includes shipments, inventories, and new and unfilled orders was released by the Deutsche Bundesbank.
The market was expecting a rise of 0.2% in August 2016, compared with the previous month. However, the result was above the forecast, as there was an increase of 1%. The result was positive, so there is a chance that the Euro may bounce from the support soon. Later today, the ECB Monetary Policy Meeting Accounts, which contain an overview of financial market, economic and monetary developments will be published. It may also impact the shared currency and we may see some moves in the EURUSD pair.
Overall, it as long as the pair is above the highlighted support area, it may recover soon.
