The EUR/USD was mixed during last week’s trading session but closed slightly on the upside at the end of the week. Weekly bias remains on the upside with a fresh divergence of the 21 and 55 EMA’s on the daily time-frame to the upside. The 4hour time-frame also shows that more demand of the pair is expected as Stochastic, RSI and MACD is all pointing for a continuation of the current uptrend.
More demand of the pair is expected to 1.38910 resistance (December 2013 high). A clear break of the resistance would confirm resumption of the uptrend in the bigger picture. However in the medium picture, a break below 1.36856 support, which happens to form around 38.2% Fibonacci level drawn from support 1.35610 to 1.37714 resistance could see the pair fall to 1.36410 (61.8% Fibonacci level).
The economic news for the US has been disappointing in recent weeks, although updates on jobless claims and the manufacturing sector offer a brighter view. Nonetheless, it’s easy to assume that the business cycle is faltering, based on weak numbers for housing starts, retail sales, payrolls and personal income in the latest releases.
Key economic reports to watch out for in the U.S economy in the coming week is the Consumer confidence, Core durable goods, New Home Sales and most importantly the Prelim GDPq/q.