The Euro is trading higher against the U.S. Dollar on Thursday, but the price action has been limited. The inside trading range suggests investor indecision and impending volatility. The single-currency is trading higher this week with most of the rally being fueled by weaker-than-expected U.S. economic data. Mixed news about a U.S.-China trade deal has been helping to limit the price action.
At 14:26 GMT, the EUR/USD is trading 1.1098, up 0.0021 or +0.19%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. However, the rally stalled on Wednesday with the formation of a minor closing price reversal top. The chart pattern doesn’t mean the trend is changing, but it does signal that the selling may be greater than the buying at current price levels.
A trade through 1.1116 will signal a resumption of the uptrend. A trade through 1.1066 will confirm the reversal top. This could trigger a short-term pullback.
The short-term range is 1.1176 to 1.0981. The EUR/USD is currently trading inside its retracement zone at 1.1079 to 1.1102. Trader reaction to this zone will determine the near-term direction of the Forex pair.
On the downside, the support zone is 1.1020 to 1.0994.
Daily Technical Forecast
Based on the early price action and the current price at 1.1098, the direction of the EUR/USD the rest of the session on Thursday will be determined by trader reaction to the short-term Fibonacci level at 1.1102.
A sustained move over 1.1102 will indicate the presence of buyers. The first upside targets are a downtrending Gann angle at 1.1114 and yesterday’s high at 1.1116.
Taking out 1.1116 will indicate the buying is getting stronger with the next target angle coming in at 1.1145.
The inability to overcome 1.1102 will signal the presence of sellers. The first downside target is the 50% level at 1.1079, followed closely by an uptrending Gann angle at 1.1061.
The angle at 1.1061 is a potential trigger point for an acceleration to the downside with the next target a support cluster at 1.1029 to 1.1021.
A retracement zone and triangle chart pattern are helping to hold the EUR/USD in a trading range. Be patient. These are breakout patterns so be prepared for upcoming volatility.
This article was originally posted on FX Empire
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