08.05.201404:13 Forex Analysis & Reviews: Technical analysis of EUR/USD for May 08, 2014

EUR/USD

Today traders eye the ECB's press conference. The European Central Bank is likely to hold off policy actions at today's meeting.

Review- German factory orders

The German factory orders plunged unexpectedly in March as demand slumped, both at home and abroad, particularly from other nations using the euro, and the government cautioned the crisis in Ukraine could contribute to further weakness.The economy ministry said Wednesday that industrial orders dropped 2.8 percent over February, the largest month-on-month fall since November 2012. Economists had predicted a 0.3 percent rise, following an upwardly revised 0.9 percent gain in February.

Domestic orders fell 0.6 percent, while foreign orders were down 4.6 percent, led by a 9.4 percent drop from other countries in the 18-nation eurozone.

Technical view-

The economic data from the French and German produces weakness in the euro. As of now, the pair opened today's trading on a bearish note. In Asia's trading session, the pair is trading at 1.3908. We still recommend the strategy to sell on the rally. In the h4 chart, the pair gave a break out at the 1.39 level on May 06, now it is trying to hold the breakout level. The Stochastics in the h4 chart is suggesting a pull back to take place during today's trading session. We may expect it can pull back up to 1.3940-1.3950 levels. At every higher level traders can short, the RSI in the H4 chart is supporting the sell-on-rally strategy.

For an intraday session, on the down side the pair has support between 1.39-1.3880 levels. Below this, the immediate support exists at 1.3864. The sell call will be triggered below 1.3864 for 1.3774. Buy on an intraday basis and sell at higher levels.

Buy at cmp 1.3909 for targets 1.3925, 1.3950 and 1.40.