The Euro is trading at a one-week high against the U.S. Dollar on Wednesday as investors grew cautiously optimistic about the outlook for the single-currency before the signing of a U.S.-China trade deal.
Investors started to become a little cautious on Monday as details of the trade deal began to emerge. One concern emerged after U.S. Treasury Secretary Mnuchin said existing tariffs on Chinese goods would stay, pending further talks.
At 18:17 GMT, the EUR/USD is trading 1.1159, up 0.0032 or +0.29%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. A trade through 1.1085 will change the main trend to down. A move through 1.1239 will signal a resumption of the uptrend.
The minor trend is also up. It turned up on a move through 1.1147. This shifted momentum to the upside. The new minor bottom is 1.1105.
On the downside, the major support is the 50% level at 1.1105. This is followed by the Fibonacci level at 1.1045.
Earlier today, the EUR/USD crossed to the strong side of a 50% level at 1.1146. This is potential support.
The short-term range is 1.1239 to 1.1085. Its 50% level at 1.1162 is currently being tested. The next target is the long-term Fibonacci level at 1.1185. Another potential upside target is 1.1209.
Daily Swing Chart Technical Forecast
Based on the early price action and the current price at 1.1159, the direction of the EUR/USD into the close is likely to be determined by trader reaction to the 50% level at 1.1162.
A sustained move over 1.1162 will indicate the buying is getting stronger. This could trigger a surge into the Fib level at 1.1185, followed closely by a downtrending Gann angle at 1.1189.
A sustained move under 1.1162 will signal the presence of sellers. The next targets come in at 1.1146, 1.1139 and 1.1136.
Taking out 1.1136 could trigger an acceleration to the downside with 1.1105 and 1.1096 the next potential targets.
This article was originally posted on FX Empire
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