EUR/USD Mid-Session Technical Analysis for December 3, 2018

The Euro is trading higher against the U.S. Dollar on Monday in reaction to the truce between the United States and China, however, the single-currency has given back more than half of its earlier gains. The news has encouraged investors to exit safe-haven dollar investments and move into riskier assets. Gains were limited by a spike in U.S. Treasury yields, which made the dollar a more attractive asset.

At 1306 GMT, the EUR/USD is trading 1.1335, up 0.0014 or +0.13%.


Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum shifted to the upside with the formation of the closing price reversal bottom on November 28 and the subsequent confirmation.

A trade through 1.1474 will change the main trend to up. A move through 1.1267 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The minor trend is down. A trade through 1.1403 will change the minor trend to up. This will also confirm the change in momentum.

The EUR/USD is also caught between a pair of retracement zones. These are helping to hold the Forex pair in a range.

The main range is 1.1216 to 1.1474. Its retracement zone is 1.1345 to 1.1315. The minor range is 1.1474 to 1.1267. Its retracement zone is 1.1370 to 1.1395. The combination of these ranges creates a wide range at 1.1315 to 1.1395. The EUR/USD has been trapped inside this zone for three sessions.

Daily Technical Forecast

Based on the early trade and the last price at 1.1335, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to the 50% level at 1.1345.

Bullish Scenario

A sustained move over 1.1345 will indicate the presence of buyers. This could lead to a labored rally with layers of potential resistance coming in at 1.1366, 1.1370, 1.1384 and 1.1395.

The trigger point for a potential acceleration to the upside is 1.1403. This could trigger a move into the next downtrending Gann angle at 1.1429. This is a potential trigger point for another acceleration into a major 50% level at 1.1447 then the main top at 1.1474.

Bearish Scenario

A sustained move under 1.1345 will signal the presence of sellers. This could drive the EUR/USD into the Fib level at 1.1315. If this price fails then look for the selling to extent into the support cluster at 1.1294 to 1.1291. If this area fails then look for the selling to extend into 1.1267.

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.