EUR/USD continued the bullish momentum yesterday and made a high at 1.1364. The outlook remains bullish especially if we see a clear break above 1.1375, to test 1.1450-1.1500 area. Immediate support is seen at 1.1280.
Yesterday EURUSD rallied but this time with a narrow range and closed in the middle of the daily range, however managed to close above the previous day high, suggesting bullish momentum.
The pair is trading above the 10, 50 and the 200-day moving averages that are acting as dynamic supports.
The key levels to watch are: A daily resistance at 1.1456, the 2016 high at 1.1376 (resistance), the previous swing high at 1.1342 (resistance), a daily support at 1.1237, the 10-day moving average at 1.1230 (support) and the 50 day moving average at 1.1130.
1.1386 is the 23-week high 1.1495 is the 30-week high
it is also important to know, that the 20 MA on the monthly chart will meet the current price at near 1.1410 This may cause a major pull-back, especially because the monthly chart is in congestion with currently 13 bars.
As I have mentioned, prices advanced to 1.1410 and then got pushed back because of the event described above. This is often a good spot for short-term traders to place a limit/sell order. Tomorrow, a new bar will start on the monthly chart and the trend situation may change for a while.
One easy way to spot a consolidation or congestion is, when bars have alternating opens and closes. Usually there are one or two bars that have the open lower than the close (uptrend within the bar) followed by one or two bars where the open and close position is in the opposite direction / open price is higher than the close price = down trend within the bar. This can be observed in any chart time frame. Sometimes in a congestion (bar 11 to bar 21 with a measuring bar) there are 3 bars in the same trend, followed by a reversal bar. These reversal bars can be traded in the direction of the reversal bar. If the reversal bar has its open higher then its close price, then sell 1 pip below the low of the reversal bar. If the situation is in the opposite direction, buy at the high of the reversal bar (ask price!) + 1 pip.
The EUR/USD made a high today at 1.1411, exactly where resistance is. The pair is now trading around 1.1380. If 1.1410 is not taken out by tomorrow there is a chance that bears might be able to bring the Euro down and go below 1.13.
HIGH RISK WARNING: Foreign exchange trading carries a high level of risk that may not be suitable for all investors.
Leverage creates additional risk and loss exposure. Before you decide to trade foreign exchange, carefully consider your investment objectives, experience level, and risk tolerance.
You could lose some or all of your initial investment. Do not invest money that you cannot afford to lose. Educate yourself on the risks associated with foreign exchange trading, and seek advice from an independent financial or tax advisor if you have any questions.
Any data and information is provided 'as is' solely for informational purposes, and is not intended for trading purposes or advice.
Past performance is not indicative of future results.