EUR/USD Mid-Session Technical Analysis for January 31, 2018

The EUR/USD is trading higher shortly after the U.S. session opening. The range is tight and volume is low ahead of a slew of U.S. government data this morning including the ADP private sector jobs report. The major event today will be the release of the U.S. Federal Reserve’s interest rate decision and monetary policy statement at 1900 GMT.

The Fed is widely expected to leave its benchmark interest rate unchanged at 1.50%. However, traders will be looking at the statement for any hints on the timing of future rate hikes and the central bank’s opinion on inflation. Currently, the Fed is looking to raise rates at least three times in 2018.


Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through 1.2537 will signal a resumption of the uptrend. This could trigger an extension of the rally into the major Fibonacci level at 1.2597. This price is a potential trigger point for an acceleration to the upside.

Today’s earlier price action helped form a new main bottom at 1.2334. A trade through this level will change the main trend to down.

The short-term range is 1.2537 to 1.2334. Its 50% level or pivot is 1.2435. This price is also controlling the direction of the EUR/USD today.

The intermediate range is 1.2164 to 1.2537. Its retracement zone is 1.2351 to 1.2307. This zone provided support on Wednesday.

The major 50% level or pivot comes in at 1.2166.

Daily Technical Forecast

Based on the early trade, the direction of the EUR/USD the rest of the session will be determined by trader reaction to 1.2435.

A sustained move over 1.2435 will indicate the presence of buyers. This could trigger a labored rally into a series of downtrending Gann angles at 1.2457, 1.2497 and 1.2577. The latter is the last potential resistance angle before the 1.2537 main top.

A sustained move under 1.2435 will signal the presence of sellers. The daily chart is wide open under this level so this could lead to an acceleration into 1.2351, followed closely by 1.2336, 1.2334 then 1.2307.

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.