IForex Daily: EUR Drops, Reaches 11 Year Low
iFOREX | Mar 05, 2015 06:35AM ET
The euro posted a sharp drop on Wednesday reaching 11 year lows against the dollar, in expectation of Thursday's European Central Bank meeting where policymakers are expected to release critical details on a monetary easing program that was passed last January. Among the topics expected to be discussed at the meeting in Cyprus include: projections for inflation and growth, the length and scope of the program, as well as projections for when interest rates could rise again in Europe. In the meanwhile U.S stocks and gold fell yesterday amid mixed economic data from the U.S. Oil prices also fell sharply after U.S. data indicated that oil supplies nationwide reached the highest level ever
EUR/USD
The U.S. dollar rose to its highest level against the euro on Wednesday in more than 11 years, ahead of the European Central Bank's announcement on Thursday detailing the start of its 60 billion a month quantitative easing program. The EUR/USD fell as low as 1.1060 on our platform. In addition, monthly U.S ADP employment data said that the private sector added 212,000 non-farm jobs in February, just below forecasts of a 220,000 gain while the U.S. Services sector recorded its highest activity level since October. For today the main focus for investor's will be the ECB announcement, however the market is also expected to react to U.S jobless claims and factory orders data due to come out later in the day.
Pivot
1.115
Support
1.102
1.0985
1.094
Resistance
1.115
1.1185
1.121
Scenario 1: Short positions below 1.115 with targets @ 1.102 & 1.0985 in extension.
Scenario 2: Above 1.115 look for further upside with 1.1185 & 1.121 as targets.
Comment: The pair has broken below its previous low and remains on the downside.
XAU/USD
On Wednesday gold prices fell below $1,200, following the mixed data from U.S employment and services sectors. The drop was limited by the fact that India, one of the world's biggest buyers lowered its interest rate from 0.25% to 7.5% as a lower interest-rate decreases the price of holding onto the precious metal. The move came days after China announced over the weekend that it will also be taking easing measures with India. The two Asian nations account for more than 50% of all gold purchases worldwide. For today the main focus for investor's will be the ECB announcement, however the market is also expected to react to U.S jobless claims and factory orders data due to come out later in the day
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Pivot
1209
Support
1195
1190.1
1186.6
Resistance
1209
1214.75
1219.9
Scenario 1: Short positions below 1209 with targets @ 1195 & 1190.1 in extension.
Scenario 2: Above 1209 look for further upside with 1214.75 & 1219.9 as targets.
Comment: As long as 1209 is resistance, likely decline to 1195.
OIL/USD
Oil prices fell sharply on Wednesday after U.S. data indicated that oil supplies nationwide reached the highest level ever, raising concerns for further decline. The U.S. Energy Information Administration (EIA) said in its weekly report that crude oil inventories rose by 10.3 million barrels for the week that ended marking the largest weekly increase since 2002. On Thursday crude oil prices gained slightly, recovering part of the drop with investors focusing on signs of demand globally and on growth data from the U.S related to factory orders.
Pivot
49.6
Support
49.6
48.7
47.8
Resistance
52.4
53.1
54.2
Scenario 1: Long positions above 49.6 with targets @ 52.4 & 53.1 in extension.
Scenario 2: Below 49.6 look for further downside with 48.7 & 47.8 as targets.
Comment: The RSI is mixed to bullish.
DOW/USD
The main U.S. stock indices ended lower on Wednesday following a series of data that painted a mixed picture of the U.S labor market as it revealed private-sector job creation slowed last month. The ADP employment report which is considered a pre-indicator of the NFP jobs report was below expectations for February. Following the data, Dow Jones moved lower to end the day in negative territory. For today, the main focus is on the ECB announcement on monetary policy, however investors will also be watching weekly jobless claims from the U.S as last week, data revealed initial claims for unemployment benefits jumped by the most since December 2013.
Pivot
18200
Support
17980
17940
17850
Resistance
18200
18270
18310
Scenario 1: Short positions below 18200 with targets @ 17980 & 17940 in extension.
Scenario 2: Above 18200 look for further upside with 18270 & 18310 as targets.
Comment: As long as 18200 is resistance, look for choppy price action with a bearish bias.
Facebook Inc (NASDAQ:FB)
Facebook stock rose in Wednesday's session, on reports that the company is creating its own mobile advertising distributor to rival Twitter's MoPub in an effort to attract more business in a growing market, according to Bloomberg. Facebook has made several advertising moves which may be revealed in its F8 developer conference this month.
Pivot
73.3
Support
73.3
68.45
62.4
Resistance
82.15
87.3
95
Scenario 1: Long positions above 73.3 with targets @ 82.15 & 87.3 in extension.
Scenario 2: Below 73.3 look for further downside with 68.45 & 62.4 as targets.
Comment: The RSI is above its neutrality area at 50%.
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