(Bloomberg) -- The euro’s gains against the dollar may persist, according to at least three technical indicators. Parabolic Systems, which traders use to track the strength of a trend, switched to a buy sign on June 24. The Directional Movement Index, or DMI, shows the strength of the so-called uptrend is gathering pace. The common European currency climbed 0.8 percent to $1.4100 as of 1:31 p.m. in London as China repeated its call for a global currency and stocks rose, extending the euro’s advance this week to 1.2 percent. “The technical situation has improved,” Ralf Umlauf, head of floor research at Helaba Landesbank Hessen-Thueringen in Frankfurt, said today by e-mail. Also, “as equity prices rebound, generally the euro strengthens,” he said.
The TD Combo indicator, which traces a security’s price patterns to determine whether a trend is losing momentum, signaled an advance in the euro to “marginal new highs” against the dollar, before the U.S. currency can achieve a “concerted” recovery, according to Paul Day, chief market analyst at MIG Investments SA in Neuchatel, Switzerland. “Though bearish in the medium term, a short-term push higher over the next few sessions wouldn’t surprise and would complete the TD Combo trend-exhaustion count, giving stronger conviction to the technical view that it’s the final push before a downtrend resumption,” Day wrote today in an e-mailed report.
China’s central bank renewed its call for a global currency and said the International Monetary Fund should manage part of its members’ foreign-exchange reserves. The MSCI World Index of equities advanced 0.9 percent, leaving it 0.2 percent higher in the week.
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