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EUR/USD Forecast 2 Apr 2014

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EUR/USD Chart 2 Apr 2014
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The Euro is awaiting fresh catalysts against the US dollar

As the day unfolded there was a plethora of news releases that could move the market, however instead what we got was a rather benign performance from the single currency. The data points for the Euro Area were not bad, however with the recent electoral defeat on France, the current socialistic government announced that it is lowering its deficit targets.

As of right now we are having a two scenario analysis that we will present in the next couple of lines to our readers. As you can see on our attached chart there are a couple of lines at which we are looking. Basically if we manage to close above or below either one on an hourly basis then we will enter a trade on a daily basis for tomorrow's expiry.

The first scenario is for the EUR/USD binary options forex pair to break higher by testing above 1.3805-10 area and closing above that level at the end of a given hour. Should that happen we will immediately buy a daily call option for export on the 2nd of April, however we will beware a false break and cover our exposure if the price breaks back below 1.3780.

The second scenario is to look for a close below yesterday's post breakout low in the 1.3760-65 area. Once a breakout below occurs, and we see an hourly close below the above mentioned levels we will be addressing the market with a swift trade. We would buy a daily put options with an expiration date for the 2nd of April 2014.

What will be the key to the developments ahead you might ask, well the answer is not simple, but from a technical point of view we are consolidating throughout the day, so there is a big likelihood that we will see a bog move from this pair. The only question that remains is whether it will be on Wednesday of Thursday, when we see the big ECB press conference event.

Tomorrow will be rather light on data as we are gearing ourselves for the more generous next couple of days, however it is worth to pay attention to the US ADP private employment survey that will be released at 12:15 GMT. The other relevant release is the final Euro Zone GDP data for the fourth quarter of 2013, however we don't expect any surprises there that could affect in a meaningful way the pair.

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.

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