Fundamental Analysis – Unemployment Rate increased and Angela Merkel’s challenges soared
On the European front, Angela Merkel’s electioneering campaign remains in full swing as the country is approaching to the full employment level. German unemployment numbers released today increased unexpectedly by 7K, while the forecast was a decrease by 5K which has pushed the euro lower. This has certainly created more challenges for Angela Merkel who is trying to convince Germany that she is the best person to run the country. Having said that, it is a fact that there is no recession in the country and thanks to Angela Merkel and her policies which has pulled the country out of a recession on the path of a stronger growth because, let’s not forget that Germany certainly has a spill over effect for rest of the Europe.
Technical Analysis – EUR/USD- Upward move could be on the cards
The EUR/USD pair fell sharply by breaking the wedge pattern on a 30 minute time frame. The volatility for the pair is extremely high as the price has pierced the Bollinger band and it is trading away from its 20day moving average. The piercing of the Bollinger band does have a significant importance when this takes place at an important level of support/resistance level because this has the tendency to pause the ballistic move or it could reverse the trend. The pair is also trading below the 50 day (shown in green) and 100 day (shown in yellow) moving averages which confirms that there the bears are in strong control.
However, the RSI is trading in line in an extreme oversold zone therefore this could move the price back up