EUR/USD Feb. 22 – Losing Multiple Support Lines

EUR/USD is falling and losing multiple support lines, as Middle East troubles and the Christchurch earthquake scare the markets. Where will it stop? Here’s a quick update on technicals, fundamentals and community trends.

EUR/USD Technicals

• Asian session:  Euro/Dollar began dropping and lost 1.3610. More lines were lost later.
• Current range – 1.35 – 1.3570

• Further levels in both directions: Below 1.35, 1.3440, 1.3334, 1.3267, 1.3180, 1.3080, 1.2970.
• Above:  1.3570, 1.3610, 1.37, 1.3760, 1.3830,  1.3950, 1.4030, 1.4160 and 1.4230.
• 1.3440 is important support below – just proved itself last week – we are not so far from this line anymore.
• The  failure  to conquer the critical 1.3760 and more recently 1.37 is a bearish sign

Euro/Dollar below free falling- click on the graph to enlarge.

EUR/USD Fundamentals –

• 7:00 GfK German Consumer Climate. Exp. 5.8 points. Actual: 6 points.
• 14:00 European NBB Business Climate. Exp. 4.6 points.
• 14:00 S&P/CS Composite-20 HPI. Exp. -2.2%.
• 15:00 CB Consumer Confidence. Exp. 65.1 points.
• 15:00 Richmond Manufacturing Index. Exp. 18 points.
• 18:00 FOMC member Narayana Kocherlakota talks.

* All times are GMT.

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

EUR/USD Sentiment

• Earthquake in Christchurch New Zealand is  devastating  with many casualties. The earthquake is felt all over the financial markets and boosts the US dollar – a currency that rises in fear mode.
• The situation in Libya is becoming  chaotic – a civil war. As Libya is an exporter of oil, the mess sends the prices higher and this endangers global growth – yet again helping the US dollar.
• 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.
• 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. Elections are held on Friday, February 25th.
• A bailout for Portugal is getting closer as bond yields are rising and becoming unsustainable again.

Currensee Community: 61% are long , 39% are short. These are 1353 open positions in real accounts trading this pair at the moment.