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EUR/USD 4hr 20 SMA comes as key support - FXStreet

FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet explained that the EUR/USD pair closed Thursday with some gains, as investors once again chose to run towards the funding currency in a strong risk aversion environment, particularly during the first half of the day.

Key Quotes:

"The pair traded as high as 1.1295 during the American session, following a sharp decline in local indexes, but pulled back from its highs before the closing bell, and trades back below the key resistance around 1.1245. Daily basis, the pair is still unable to recoup above its 20 SMA, whilst the technical indicators hold a neutral stance, clearly reflecting ongoing investors' uncertainty. Data released early in Europe showed that German consumer confidence is expected to decline in October, from its previous 9.9 to an actual 9.6, although the IFO survey showed that business confidence edged higher in September, climbing to 108.5 from a revised 108.4 in August. In the US, data were mixed, with better than expected weekly unemployment claims, and new home sales, this last up by 5.7% in August, but Durable Goods orders declined in August by 2% whilst the core reading came out flat at 0.0%, continue signaling a tepid recovery in the US at the beginning of the third quarter.

Short term, the 1 hour chart shows that the price retreated over 60 pips from its highs, and its approaching a bullish 20 SMA around 1.1210, now the immediate support, whilst the technical indicators maintain their bearish slopes coming from overbought readings, but are still above their mid-lines, far from confirming a downward continuation.

In the 4 hours chart, the price is above a bearish 20 SMA, currently around 1.1160, whilst the technical indicators turned south, and are about to cross their mid-line towards the downside, in line with the shorter term view."

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