The exchange rate began this week by bouncing off the minor support of the 0.7100 level. At that level a large cluster of buy orders begins and lasts as low as the 0.6800 mark.
In the meantime, the pair's most close by resistance was located 6.86% above Monday's price, at 0.7700.
Previous Daily Candle Chart
© Dukascopy Bank SA
Updated Daily Candle Chart
© Dukascopy Bank SA
On the daily candle chart one can observe that volatility of the currency exchange rate has been declining, as daily fluctuations take place in a three pip range. In theory, a lack of volatility signals that a sharp move is upcoming.
Meanwhile, note that the updated chart shows the support and resistance areas created by set up buy and sell orders.
Market Depth
If one looks at the market depth statistics published at dukascoin.com, it can observed that the pair faces a strong support cluster from the 0.7100 to the 0.6800 level.
© Dukascopy Bank SA
There is a minor concentration of buy orders at 0.7100. Meanwhile, at the 0.7000 level there are the most bids. This cluster of support was formed last week.
© Dukascopy Bank SA
Meanwhile, the rate faced minor resistance.
The most close by notable resistance was at 0.7700. Although, this level was unlikely to stop a sudden surge.
A notable concentration of sell orders on Monday was located at the 0.8000 level.
Future outlook
In regards to the future outlook, the rate is most likely going to surge, as the buy orders from 0.7100 to 0.6800 provide the pair with support.
In that case scenario, the DUK+/EUR pair would face no resistance as high as the 0.7700 level, where the most close by cluster of sell orders is located at.
On the other hand, the pair could gradually decline through the support levels. Although, it could take a long time and would most likely occur simultaneously with sell orders being set up closer to the currency pair.
If the rate would decline below the 0.6600 level, it could plummet to the massive concentration of buy orders at 0.6000.