1.1675 for shorts, anyone?
EUR/USD bulls, as you can see, lost their flavor just ahead of the H4 mid-level resistance at 1.1750 on Thursday, consequently forcing price through a number of key H4 support barriers. Despite disappointing US durable goods orders m/m, the euro fell sharply after Draghi clarified guidance regarding an interest rate hike through summer 2019 at the earliest.
As a result of yesterday’s move, the H4 candles appear free to cross swords with the trend line support etched from the low 1.1508 and nearby 1.16 handle. Our rationale behind this approach comes from seeing H4 demand around the 1.1640-1.1715 area marked with a green arrow likely already consumed by Tuesday’s low at 1.1654 (red arrow).
Daily movement responded beautifully to the underside of supply at 1.1790-1.1732, forming a near-full-bodied bearish candle in the direction of nearby support priced in at 1.1575. In terms of weekly action, however, the pair is seen testing trend line support (etched from the low 1.0340) after selling off from a neighboring resistance area at 1.1717-1.1862.
Areas of consideration:
In light of recent events, the team has noted to keep eyeballs on the underside of July’s opening level printed on the H4 timeframe at 1.1675 for a possible retest play (pink arrows), targeting the noted H4 trend line support as the initial take-profit zone.
The only drawback to a sell in this market, of course, is the current weekly trend line support. To help overcome this, traders are urged to wait and see if H4 price can chalk up a full or near-full-bodied bearish candle from 1.1675 prior to pulling the trigger.
Today’s data points: US GDP (advance) q/q; US Revised UoM consumer sentiment.
As a result of yesterday’s move, the H4 candles appear free to cross swords with the trend line support etched from the low 1.1508 and nearby 1.16 handle. Our rationale behind this approach comes from seeing H4 demand around the 1.1640-1.1715 area marked with a green arrow likely already consumed by Tuesday’s low at 1.1654 (red arrow).
Daily movement responded beautifully to the underside of supply at 1.1790-1.1732, forming a near-full-bodied bearish candle in the direction of nearby support priced in at 1.1575. In terms of weekly action, however, the pair is seen testing trend line support (etched from the low 1.0340) after selling off from a neighboring resistance area at 1.1717-1.1862.
Areas of consideration:
In light of recent events, the team has noted to keep eyeballs on the underside of July’s opening level printed on the H4 timeframe at 1.1675 for a possible retest play (pink arrows), targeting the noted H4 trend line support as the initial take-profit zone.
The only drawback to a sell in this market, of course, is the current weekly trend line support. To help overcome this, traders are urged to wait and see if H4 price can chalk up a full or near-full-bodied bearish candle from 1.1675 prior to pulling the trigger.
Today’s data points: US GDP (advance) q/q; US Revised UoM consumer sentiment.
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