EUR/USD Mid-Session Technical Analysis for October 5, 2018

The Euro is trading slightly lower shortly before the U.S. opening and the release of the U.S. Non-Farm Payrolls report. The inside move suggests investor indecision and impending volatility. On Thursday, the Euro formed a potentially bullish closing price reversal bottom. This wasn’t unexpected due to the prolonged move down in terms of price and time.

At 1019 GMT, the EUR/USD is at 1.1494, down 0.0019 or -0.17%.


Daily Technical Analysis

The main trend is down according to the daily swing chart. The EUR/USD is in no position to change the trend to up, but a confirmation of the closing price reversal bottom will shift momentum to the upside.

A trade through 1.1543 will confirm the closing price reversal bottom. This could lead to a 2 to 3 day follow-through rally.

A move through 1.1463 will negate the closing price reversal bottom and signal a resumption of the downtrend. This could lead to an eventual test of the next main bottom at 1.1301.

The minor trend is also down. A trade through 1.1596 will change the minor trend to up. This will also confirm the shift in momentum to up.

The main range is 1.1301 to 1.1816. The market is currently testing its retracement zone at 1.1559 to 1.1498. Trader reaction to this zone will determined the near-term direction of the EUR/USD.

The new minor range is 1.1816 to 1.1463. If the reversal bottom is confirmed then its retracement zone at 1.1640 to 1.1681 will become the primary upside target.

Daily Technical Forecast

Based on the early price action, the direction of the EUR/USD is likely to be determined by trader reaction to the uptrending Gann angle at 1.1486.

A sustained move over 1.1486 will indicate the presence of buyers. Overtaking the Fib level at 1.1498 will indicate the buying is getting stronger. Taking out 1.1543 will confirm the closing price reversal bottom.

If the move through 1.1543 creates enough upside momentum then look for buyers to go after the 50% level at 1.1559. Taking out this level could trigger an acceleration to the upside with the first target 1.1596. The next target is the resistance cluster at 1.1636 to 1.1640.

A sustained move under 1.1486 will signal the presence of sellers. This should lead to a quick test of 1.1463.

The next target is a steep downtrending Gann angle at 1.1456. Crossing to the weak side of this angle will put the EUR/USD in a bearish position with the next target angle 1.1394. This is the last potential support angle before the 1.1301 main bottom.

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.