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EUR/USD Mid-Session Technical Analysis for August 12, 2019

James Hyerczyk

The Euro is trading lower versus the U.S. Dollar on Monday on heightened concerns over U.S.-China trade relations and political unrest in Hong Kong that led to the government shutting down the country’s airport. There are also reports that the Swiss National Bank was forced to intervene in currency markets to prevent the franc from appreciating further. Global bond yields are under pressure as well as demand for higher risk assets.

At 11:38 GMT, the EUR/USD is trading $1.1189, down 0.0012 or -0.11%.

Daily EUR/USD

Daily Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since the formation of the closing price reversal bottom at 1.1027 on August 1. Additionally, a minor reversal top at 1.1250 on August 6 has slowed the upside momentum.

A trade through 1.1250 will change the minor trend to up and negate the minor reversal top. The main trend will change to up on a move through 1.1282. It will be reaffirmed on a trade through 1.1286.

A trade through 1.1027 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main range is 1.1413 to 1.1027. Its retracement zone at 1.1220 to 1.1265 is resistance. This zone stopped the rally at 1.1250.

The long-term Fibonacci level at 1.1185 is acting like a pivot price today.

The short-term range is 1.1027 to 1.1250. Its retracement zone at 1.1139 to 1.1112 is the next potential downside target. This move could attract aggressive counter-trend buyers. They will attempt to form a secondary higher bottom.

Daily Technical Forecast

Based on the early price action, the direction of the EUR/USD on Monday will be determined by trader reaction to the downtrending Gann angle at 1.1202 and the uptrending Gann angle at 1.1167.

Bullish Scenario

A sustained move over 1.1202 will indicate the presence of buyers. If this creates enough upside momentum then look for a drive into a 50% level at 1.1220. Overtaking this level could trigger a surge into another downtrending Gann angle at 1.1243, followed by the minor top at 1.1250 and the Fibonacci level at 1.1265.

The Fib level at 1.1265 is the last potential resistance before the 1.1282 and 1.1286 main tops.

Bearish Scenario

A sustained move under 1.1167 will signal the presence of sellers. This could trigger an acceleration to the downside with the retracement zone at 1.1139 to 1.1112 the next downside target. This zone is followed by an uptrending Gann angle at 1.1097.

This article was originally posted on FX Empire

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