The euro will continue to rise this week
The euro will continue to grow this weekV Monday, August 29, trades on the euro ended in positive territory. The buyers did not reach the level of 1.20, but shifted the Asian high at 1.1960 to 1.1986. The market continues to be influenced by Friday’s performances by Janet Yellen and Mario Draghi in Jackson Hole. Plus the media is warming up the topic with Hurricane Harvey. In their opinion, it will have a negative impact on the US economy. The yield of 10-year bonds in the US fell to the level of 2.11%.
Expectations on Monday did not materialize. It seems that the market began to implement an alternative scenario with three peaks. As you can see, the buyers stayed at the level of 1,1984. After updating the maximum, the euro was corrected to 1.1956, from which the price for six hours was restored to 1.1979.
At the current hour, the resistance line passes through the mark of 1.2022. If we take the projection from the last two vertices, then the level 1,2003 is the target for the third vertex. Between the second peak and the price, a “bearish” divergence was formed. With three vertices, a double divergence is formed.
Another factor that made me to make a forecast for a decline is the falling cycles on the hourly period. The euro rises in price against cycles, which means that the longer such resistance lasts, the more the price will fall.
I think that the euro / dollar pair should be unloaded to the balance line. At the current bar, it is at the level of 1,1900. If you look at it in dynamics, then at the American session it will pass through the level of 1,1931. With the growth and closing of the hour above 1.20, I will do another scenario, since the price model will change.
At 15:30 Moscow time in Canada will be the index of commodity prices for July, the producer price index for July.
At 16:00 Moscow time in the US will publish an index of housing prices from S & P / CS for June.
At 17:00 Moscow time in the US will issue an index of consumer confidence from the CB for August.