The Euro has an eye on Italian politics following the news that an Italian coalition government could be in the making. The leaders of the League and Five Movement parties have announced that they could form a functioning government.
‘[Neither party should] look to 19th-Century solutions when trying to solve the problems of the 21st Century.’ Italian President Sergio Mattarella has warned.
The ongoing correction in the US Treasury bond yields, along with fading expectations of faster Fed rate hike moves, pushed traders to continue unwinding their long USD besides yesterday’s softer CPI.
The Canadian employment change fell hard to 1.1K after the forecast was 17.8K. This erased the gains the currency had made according to high oil prices.
On the daily chart, the price has reached the support zone of 0.7035-0.6965. The price touched the uptrend line from the low of 2008 with a strong hammer. An AB=CD pattern is formed in a smaller frame.
Provided by divergence in RSI, if the price breaks the lower trend line as shown, it is expected to get back up again to the resistance zone of 0.715-0.7185.
On the daily chart, the price had a false break beneath the support zone 0.75-0.7535. That enhances the harmonic pattern AB=CD more. The pair had made a price action (pin bar) in this false break to boost the bullish bias more. Along with divergence in RSI and breaking the lower trend line as shown, the price is ready for the next move up to 0.7635 then 0.7715.
On the daily chart, the price had made its way into the resistance zone of 1.2925-1.3. With an approach from the descending trend line from the high of 2015. The price reversed from these levels, breaking beneath the key support level 1.28. If the daily candle closes under this level, it will prompt the price to be more bearish to the support zone 1.252-1.243.