EUR/USD Mid-Session Technical Analysis for October 26, 2021

The Euro is edging higher against the U.S. Dollar in a choppy trade on Tuesday. Single-currency traders lacked clear direction as investors looked ahead to the European Central Bank (ECB) meeting this week.

Traders also said that high energy prices were capping gains since the Euro Zone is a net importer of crude oil.

At 11:15 GMT, the EUR/USD is trading 1.1625, up 0.0015 or +0.13%.

Earlier in the session, the Euro was pressured by expectations that the ECB will take a dovish stance when it meets on Thursday.

“We believe that there is a good chance that the ECB will push back against current market pricing for ECB rate hikes,” wrote MUFG currency analyst Lee Hardman in a note to clients.

“The ECB’s continued reluctance to raise rates should continue to weigh on the Euro as other G10 central banks embark on hiking cycles.”

At 14:00 GMT, investors will get the opportunity to react to a U.S. consumer confidence report from the Conference Board. Traders are looking for a reading of 108.4, down from 109.3. If it comes in weaker than expected, we could see an uptick by the Euro.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher.

A trade through 1.1755 will change the main trend to up. A move through 1.1524 will signal a resumption of the downtrend.

The minor trend is up. This is controlling the momentum. A trade through 1.1572 will change the minor trend to down.

The EUR/USD is currently straddling a minor pivot at 1.1621. On the downside, pivot price support comes in at 1.1597. On the upside, another pivot at 1.1640 is generating resistance.

The short-term range is 1.1909 to 1.1524. Its retracement zone at 1.1717 to 1.1762 is the next major upside target and resistance.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD on Tuesday is likely to be determined by trader reaction to the pivot at 1.1621.

Bearish Scenario

A sustained move under 1.1621 will indicate the presence of sellers. The first downside target is 1.1597. Taking out this level will indicate the selling pressure is getting stronger. This could extend the break into the minor bottom at 1.1572.

Taking out 1.1572 will change the minor trend to down and could trigger an acceleration into 1.1524.

Bullish Scenario

A sustained move over 1.1621 will signal the presence of buyers. The first upside target is 1.1640. Taking out this level will indicate the buying is getting stronger with 1.1669 the next likely target.

Overtaking 1.1669 could trigger an acceleration into the short-term retracement zone at 1.1717 to 1.1762.

For a look at all of today’s economic events, check out our economic calendar.

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.