The Euro witnessed some buying interest during the trading session today. It is important to state that the Euro has been in a strong downtrend over the last couple of weeks and has given a clear indication that bears are in full control at the current moment which is being seen as a huge negative by traders and investors.
Many believe that the move in the Euro during the trading session was on the back of dismal economic reports coming out of the Chinese economy. It was reported that exports for October fell by 6.9 percent down for a fourth month in a row while imports slipped 18.8 percent leaving the country with a record high trade surplus of $61.64 billion which is being seen as a huge negative by traders and investors on the street. Economists on the street believe that the People’s Bank of China would be forced to increase its easing measures to provide the much needed impetus to the world’s second largest economy. It is imperative to state that economists on the street believe the slowdown in the Chinese economy poses huge downside risks to the global economy.
When looking at the charts for EUR/USD, the currency pair has been in a strong downtrend and currently trades below all important daily moving averages which is considered to be a huge negative. The momentum indicators for the EUR/USD has given a sell signal which points towards the fact that momentum has shifted towards the sell side. Traders believe the Euro could head towards parity against the dollar in the near term. The relative strength index continues to remain under pressure which is a bearish sign according to traders on the street.
Short EUR/USD at current levels for an intermediate target at $1.0688, in the near term.