EUR/USD gaps lower, close to low support

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There’s no mercy for euro/dollar: another dollar storm that originated in digesting the Jackson Hole news resulted in a Sunday gap. The open gap serves as a bearish sign.

EUR/USD hit 1.32 and fell below this line, to a new 11 month low. The pair hesitated above low support but the bounce from the lows didn’t go anywhere fast.

Here is how the Sunday gap and the “dead cat bounce” look on the chart:

EURUSD August 25 2014 Sunday gap on teh way down after Jackson Hole

The next support line is 1.3175, and the pair hit a low point of 1.3184 at the lowest. Further support is at 1.31. Resistance awaits at 1.3220, which was the low point of the pair on Friday.

What happened in Jackson Hole? Yellen didn’t offer too much. But as she is usually quite dovish, the lack of extreme dovishness did the job.

On the other side, ECB president also didn’t offer anything new, but the deteriorating situation in the euro-zone means a higher chance of QE.

For more, see the EUR to USD forecast.

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About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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