EUR/USD: consolidation at local highs 21 April 2021, 12:40

EUR/USD: consolidation at local highs

21 April 2021, 12:40

Scenario
Timeframe	Intraday
Recommendation	SELL STOP
Entry Point	1.1995
Take Profit	1.1900
Stop Loss	1.2050
Key Levels	1.1834, 1.1900, 1.1950, 1.2000, 1.2078, 1.2150, 1.2200

Alternative scenario
Recommendation	BUY STOP
Entry Point	1.2080
Take Profit	1.2200
Stop Loss	1.2010
Key Levels	1.1834, 1.1900, 1.1950, 1.2000, 1.2078, 1.2150, 1.2200

Current trend

EUR is slightly declining against USD during today's Asian trading session, again approaching strong support at 1.2000.

The day before, the instrument showed active growth and managed to update local highs since March 3; however, closer to the end of the daytime session, USD managed to win back its losses and break into zero. There were few significant fundamental factors for the correction of USD, as the macroeconomic background on Tuesday remained neutral.

Investors paid attention only to the publication of data on the Producer Price Index in Germany. In March, the indicator increased by 0.9% MoM after growth of 0.7% MoM in February. Analysts had expected it to decelerate to 0.6% MoM. On an annualized basis, the indicator increased by 3.7% YoY after growing by 1.9% YoY, which also outpaced forecasts of 3.3% YoY.

Traders await a meeting of the European Central Bank (ECB) on interest rates with a follow-up press conference, which will take place on April 22.

Support and resistance

Bollinger Bands in D1 chart show stable growth. The price range is slightly narrowed, being spacious enough for the current activity level in the market. MACD indicator is growing preserving a rather stable buy signal (located above the signal line). Stochastic, which has been near its highs for a long time, is trying to consolidate below the level of "80", signaling in favor of the development of a corrective decline in the ultra-short term.

Resistance levels: 1.2078, 1.2150, 1.2200.

Support levels: 1.2000, 1.1950, 1.1900, 1.1834.

Trading tips

To open new short positions, one can rely on the breakdown of 1.2000. Take-profit – 1.1900. Stop-loss – 1.2050. Implementation time: 1-2 days.

A rebound from 1.2000 as from support followed by a breakout of 1.2078 may become a signal to return to purchases with the target at 1.2200. Stop-loss – 1.2010.