Our technicals are pointing to further downside this week...
Weekly gain/loss: - 149 pips
Weekly closing price: 1.0635
Recent trade shows that the EUR/USD extended its bounce from the weekly resistance level at 1.0819, and ended the week chalking up a near-full-bodied weekly bearish candle. Provided that the bears remain in the driving seat here, the next weekly support target on tap can be seen at 1.0515: the 2017 yearly opening level which happens to be strengthened by a weekly support area drawn from 1.0333-1.0502.
On the other side of the ledger, however, we have the daily candles battling for position within the walls of a daily demand zone coming in at 1.0589-1.0662. Despite this base managing to hold the market higher since Jan 26 2017, nearby daily resistance at 1.0710 is proving troublesome to overcome and could force candle action beyond the current area this week down to a daily support at 1.0520 (sited 5 pips ahead of the aforementioned 2017 yearly opening level).
Friday’s US consumer sentiment survey came in worse than expected. Although this is considered a high-impacting event, it did not manage to generate much trading. Technically speaking, the H4 chart’s structure is somewhat restricted at the moment. To the downside, price bottomed around a H4 Quasimodo support at 1.0621. Meanwhile, overhead we have a H4 supply at 1.0667-1.0650 that is joined together with a H4 trendline resistance taken from the low 1.0579.
Our suggestions: Based on the higher-timeframe structure, we find it difficult to imagine the H4 candles breaching the current H4 supply today. In fact, on account of the weekly chart’s position, and daily demand looking somewhat vulnerable at this time, the aforementioned H4 Quasimodo support, along with the round number 1.06 and December’s opening level at 1.0590 may be consumed today/early this week.
In the event that we do happen to clock a H4 close below these levels, the next H4 support in the firing range can be seen at the 2017 yearly opening level. This could set the foundation for a reasonable short trade this week if the candles retest the broken levels as resistance and pencil in a H4 bear candle.
Data points to consider: There are no scheduled high-impacting news events on the docket today relating to these two markets.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: Watch for a H4 close below 1.06/1.0590 and then look to trade any retest seen thereafter (waiting for a H4 bear candle to form following the retest is advised before pulling the trigger, stop loss: ideally beyond the trigger candle).
Weekly closing price: 1.0635
Recent trade shows that the EUR/USD extended its bounce from the weekly resistance level at 1.0819, and ended the week chalking up a near-full-bodied weekly bearish candle. Provided that the bears remain in the driving seat here, the next weekly support target on tap can be seen at 1.0515: the 2017 yearly opening level which happens to be strengthened by a weekly support area drawn from 1.0333-1.0502.
On the other side of the ledger, however, we have the daily candles battling for position within the walls of a daily demand zone coming in at 1.0589-1.0662. Despite this base managing to hold the market higher since Jan 26 2017, nearby daily resistance at 1.0710 is proving troublesome to overcome and could force candle action beyond the current area this week down to a daily support at 1.0520 (sited 5 pips ahead of the aforementioned 2017 yearly opening level).
Friday’s US consumer sentiment survey came in worse than expected. Although this is considered a high-impacting event, it did not manage to generate much trading. Technically speaking, the H4 chart’s structure is somewhat restricted at the moment. To the downside, price bottomed around a H4 Quasimodo support at 1.0621. Meanwhile, overhead we have a H4 supply at 1.0667-1.0650 that is joined together with a H4 trendline resistance taken from the low 1.0579.
Our suggestions: Based on the higher-timeframe structure, we find it difficult to imagine the H4 candles breaching the current H4 supply today. In fact, on account of the weekly chart’s position, and daily demand looking somewhat vulnerable at this time, the aforementioned H4 Quasimodo support, along with the round number 1.06 and December’s opening level at 1.0590 may be consumed today/early this week.
In the event that we do happen to clock a H4 close below these levels, the next H4 support in the firing range can be seen at the 2017 yearly opening level. This could set the foundation for a reasonable short trade this week if the candles retest the broken levels as resistance and pencil in a H4 bear candle.
Data points to consider: There are no scheduled high-impacting news events on the docket today relating to these two markets.
Levels to watch/live orders:
• Buys: Flat (stop loss: N/A).
• Sells: Watch for a H4 close below 1.06/1.0590 and then look to trade any retest seen thereafter (waiting for a H4 bear candle to form following the retest is advised before pulling the trigger, stop loss: ideally beyond the trigger candle).
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