EUR/USD October 18- Falling Quickly

EUR/USD began the week with a big drop. We have a few interesting releases from the US. Are the tables turning on the Euro? Here’s a quick update on technicals, fundamentals and community trends.

EUR/USD dropping below 1.39. Click to enlarge.

EUR/USD Technicals

• Asian session:  Active session sent the pair down from just under 1.40 to 1.3870.
• Current Range between 1.3830 and 1.2950
• Further levels in both direcstions: Below,  1.3850, 1.3775, 1.3637, 1.3530, 1.3430 and 1.3333.  Above   1.3950, 1.4030, 1.4120, 1.42, 1.4450 and 1.4580.
• Uptrend support becomes irrelevant: Uptrend resistance began on Sep. 8 and uptrend support on Sep. 13. Trading is characterized with many hours of consolidation, followed by  few hours of sharp rises. Note that the uptrend support line was slightly modified. Support was lost, reconquered, and lost again. Support and resistance lines are more important.

EUR/USD Fundamentals

All times are GMT. Most important events emphasized.

• 12:30 US TIC Long-Term Purchases. Exp. 47.5 billion.
• 13:15 US Capacity Utilization Rate. Exp. 74.8%.
• 13:15 US Industrial Production. Exp. +0.3%

EUR/USD Sentiment

• Debt issues never went away, but the market disregards them. Maybe they will get more attention now.
• The inevitable second round of quantitative easing in the US still weighs on weakens the dollar, but the size of QE depends on the current situation and especially on jobs which disappointed on Friday. QE2 now looks imminent, but also fully priced in the dollar’s weakness.
• 1.3832 key level on the downside.
• 1.4030 key level on the upside.
• Currensee Community: 52% are long, 48% are short. These are 1055 open positions in real accounts trading this pair at the moment.

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