Looking for longs at 1.12...
Weekly gain/loss: + 276 pips
Weekly closing price: 1.1207
Across the board, the US dollar index plummeted last week, which, given its strong inverse correlation to the EUR/USD, helped the pair print hefty gains into the week’s close. As can be seen from the weekly chart, price is currently lurking within striking distance of a major resistance area at 1.1533-1.1278. This base has capped upside on several occasions since mid-2015, so there’s a healthy chance that history may repeat itself here!
Along similar lines, daily price recently crossed back above resistance at 1.1142 and ended the week forming a near-full-bodied bullish candle. Technically speaking, we see very little resistance on this scale until the unit connects with the said weekly resistance area.
A quick recap of Friday’s movements on the H4 chart shows that the unit concluded the day marginally closing above the 1.12 handle, reaching a high of 1.1211. Above 1.12 the pathway appears relatively free up to resistance pegged at 1.1279, followed closely by the 1.13 handle.
Our suggestions: In view of the higher-timeframe picture, additional upside in this market is probable. With that in mind, and assuming H4 price remains above 1.12 at the open, a long trade on any retest seen at this psychological number could be an option, targeting the aforementioned H4 resistance line. Ideally, however, we would also like to see a reasonably sized H4 bull candle (preferably a full-bodied candle) take shape following the retest. This, for us, helps confirm buyer interest.
Data points to consider: Eurogroup meetings (all day). FOMC member Harker speaks at 3pm GMT+1.
Levels to watch/live orders:
• Buys: 1.12 region (waiting for a H4 bullish candle to form following the retest is advised, stop loss ideally beyond the candle’s tail).
• Sells: Flat (stop loss: N/A).
Weekly closing price: 1.1207
Across the board, the US dollar index plummeted last week, which, given its strong inverse correlation to the EUR/USD, helped the pair print hefty gains into the week’s close. As can be seen from the weekly chart, price is currently lurking within striking distance of a major resistance area at 1.1533-1.1278. This base has capped upside on several occasions since mid-2015, so there’s a healthy chance that history may repeat itself here!
Along similar lines, daily price recently crossed back above resistance at 1.1142 and ended the week forming a near-full-bodied bullish candle. Technically speaking, we see very little resistance on this scale until the unit connects with the said weekly resistance area.
A quick recap of Friday’s movements on the H4 chart shows that the unit concluded the day marginally closing above the 1.12 handle, reaching a high of 1.1211. Above 1.12 the pathway appears relatively free up to resistance pegged at 1.1279, followed closely by the 1.13 handle.
Our suggestions: In view of the higher-timeframe picture, additional upside in this market is probable. With that in mind, and assuming H4 price remains above 1.12 at the open, a long trade on any retest seen at this psychological number could be an option, targeting the aforementioned H4 resistance line. Ideally, however, we would also like to see a reasonably sized H4 bull candle (preferably a full-bodied candle) take shape following the retest. This, for us, helps confirm buyer interest.
Data points to consider: Eurogroup meetings (all day). FOMC member Harker speaks at 3pm GMT+1.
Levels to watch/live orders:
• Buys: 1.12 region (waiting for a H4 bullish candle to form following the retest is advised, stop loss ideally beyond the candle’s tail).
• Sells: Flat (stop loss: N/A).
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