The EUR/USD is trading slightly higher shortly before the U.S. opening, but inside the previous day’s range. This tends to indicate investor indecision and impending volatility.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through 1.2211 will signal a resumption of the downtrend. This is followed closely by another main bottom at 1.2164. A trade through this bottom will reaffirm the downtrend. This could lead to an even steeper sell-off with 1.1915 the next main bottom target.
The main range is 1.1915 to 1.2537. Its retracement zone is $1.2226 to 1.2153. This zone provided support yesterday when the selling stopped at 1.2211.
Inside the main retracement zone is a major 50% level at 1.2166. This price is controlling the longer-term direction of the Euro.
The short-term range is 1.2164 to 1.2537. Its 50% level at 1.2351 is resistance.
Daily Technical Forecast
Based on the early trade, the direction of the EUR/USD is likely to be determined by trader reaction to the steep downtrending Gann angle at 1.2282.
A sustained move under 1.2282 will indicate the presence of sellers. This could drive the Forex pair into 1.2226 then 1.2211.
If 1.2211 fails as support then look for a break into a potential support cluster at 1.2166 to 1.2164. This is followed by another cluster at 1.2153 to 1.2145.
A sustained move over 1.2282 will signal the presence of buyers. This could trigger an acceleration to the upside with 1.2351 the next likely target.
This article was originally posted on FX Empire
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