EUR/USD Feb. 21 – Pausing at Resistance

EUR/USD cannot break higher at the wake of the new week. Middle East turmoil and balances inflation fighting boosts. Will it conquer resistance? Here’s a quick update on technicals, fundamentals and community trends.

EUR/USD Technicals

• Asian session:  Euro/Dollar climbed above 1.37, but this was short lived.
• Current range – 1.3610 – 1.37.

• Further levels in both directions: Below 1.3610, 1.3570, 1.35, 1.3440, 1.3334, 1.3267, 1.3180, 1.3080, 1.2970.
• Above:  1.37, 1.3760, 1.3830,  1.3950, 1.4030, 1.4160 and 1.4230.
• 1.3440 is important support below – just proved itself in recent days.
• The  failure  to conquer the critical 1.3760 is a bearish sign

Euro/Dollar below resistance – click on the graph to enlarge.

EUR/USD Fundamentals –

• 8:00 French Flash Services PMI. Exp. 58 points. Actual – 60.8 points – significant surprise.
• 8:00 French Flash Manufacturing PMI. Exp. 55 points. Actual 55.3 points.
• 8:30 German Flash Services PMI. Exp. 69.3 points.
• 8:30 German Flash Manufacturing PMI. Exp. 60.3 points.
• 9:00 All-European Flash Services PMI. Exp. 56 points.
• 9:00 All-European Flash Manufacturing PMI. Exp. 57.3 points.
• 9:00 German Ifo Business Climate. Exp. 110.3 points.

* All times are GMT.

For more events later in the week, see the  EUR/USD forecast

EUR/USD Sentiment

• The hawkish comment by ECB member Bini Smaghi on Friday about raising the rates sent the Euro skyrocketing.
• China raised the Reserve Ratio Rate. This is not the first time, but the 0.50% scale is rather large. This temporary hurt the Euro.
• Unrest in the Middle East currently has little impact on currencies, although the situation in Libya is serious – it is in a state of turmoil – a civil war. Libya is an exporter of oil.
• Irish debt is a big burden: There are growing talks of a default in Ireland. Opposition party in Ireland, Fine Gael,  wants a haircut for senior bondholders. Now they have a precedent of a  default in Denmark to rely on. The current government left this issue for the next government.
• A bailout for Portugal is getting closer as bond yields are rising and becoming unsustainable again.

Currensee Community: 62% are long , 38% are short. These are 1490 open positions in real accounts trading this pair at the moment.