After spiking to the upside early in the session on follow-through buying, following yesterday’s less-hawkish U.S. Federal Reserve monetary policy statement, the Euro reversed course and is now trading lower for the session.
At 1200 GMT, the EUR/USD is trading 1.2323, down 0.0015 or -0.12%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through 1.2412 will change the main trend to up. This could trigger a further rally into the next top at 1.2446.
A move through 1.2239 will reaffirm the downtrend. If this creates enough downside momentum then 1.2153 will become the next downside target.
On the upside, the retracement zone resistance comes in at 1.2354 to 1.2401.
On the downside, the retracement zone support is 1.2235 to 1.2160.
The short-term range is 1.2153 to 1.2446. Its 50% to 61.8% retracement zone is 1.2300 to 1.2265. This zone is today’s primary downside target. It is likely to act like a pivot zone.
Daily Technical Forecast
Based on the current price at 1.2323 and the earlier price action, the direction of the EUR/USD the rest of the session will be determined by trader reaction to the uptrending Gann angle at 1.2303.
Holding 1.2308 will indicate the return of buyers. If this creates enough upside momentum then we could see a retest of a downtrending Gann angle at 1.2346, followed by a 50% level at 1.2354. The price is a possible trigger point for an acceleration into 1.2396 then 1.2401.
Taking out 1.2308 will signal that the selling is getting stronger. This should lead to a quick test of the 50% level at 1.2300. The daily chart opens up to the downside under this level with the next target a Fibonacci level at 1.2265. This is followed by a loose cluster of potential downside targets and support levels at 1.2239, 1.2235 and 1.2228.
If 1.2228 fails then look out to the downside because the next target doesn’t come in until 1.2166 to 1.2153.