Sasha Singh
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EURUSD : Testing Support From 200 Day SMA, Still Bearish!!

EURUSD was earlier testing the key support at 1.3652 which it broke today after the IFO Business Climate Index was released. The Index for industry and trade in Germany fell to 110.4 points in May from 112.2 points last month. Economists were expecting the index to fall to 111. Companies are reported to be less optimistic about future business developments. For manufacturing the business climate index fell slightly but remained at a high level. However manufacturers continue to expect stronger impulses from exports.

(EURUSD : Daily Chart)

On the Daily chart, the pair is still testing the support at 200 day SMA or support at 1.3630. The pair is in the oversold zone as seen on the stochastic oscillator but it is expected to remain in this zone unless there is some strong data from euro zone shows growth or ECB come up with new measures to rise inflation. So I am still bearish on this pair.