Technical Analysis EUR/USD for November 30, 2015

The EUR/USD edged lower dropping below 1.06 as yield differentials continue to point to a stronger greenback.  The 2-year yield differential is now at the highest it’s been in the past 5-years, making it difficult to own the Euro.  Support is seen near the March lows at 1.0480, while resistance is seen near the 20-day moving average at 1.0738.  Momentum has flattened with the MACD (moving average convergence divergence) index printing near the zero index level with a flat trajectory.

German import price inflation fell to -4.1% year over year in October, from -4.0% year over year in the previous month. Expectations had been for a slight rise and the fall back will add to the arguments of the doves at the ECB ahead of next week’s council meeting, especially excluding energy the annual rate dropped to 0.3% year over year from 0.7% year over year, as basic goods prices drop -2.1% year over year.