EUR/USD:
Despite observing a brief flicker of activity around January’s opening level on the H4 timeframe at 1.1445, the single currency yielded ground to its US counterpart Monday.
Clocking lows of 1.1424 amid broad-based USD strength, yesterday’s move exposes a possible AB=CD bullish pattern (black arrows) completion today, positioned just ahead of the 1.14 handle around 1.1408. Note 1.14 is joined by a 50.0% support value at 1.1402 and a nearby 161.8% Fibonacci ext. point at 1.1387: the extreme point of the AB=CD play (yellow).
From the bigger picture a move lower was expected, having seen weekly flow begin fading resistance at 1.1465 and daily movement also tackling resistance at 1.1485. The nearest support target on the higher timeframes can be seen at an ascending channel support (etched from the low 1.1215). It might also be worth pointing out should H4 price connect with its yellow zone between 1.1387/1.1408, the market may witness a mild fakeout through this area to bring in daily buyers off the nearby aforementioned ascending channel support.
Areas of consideration:
In the event the analysis proves accurate and the market completes its H4 AB=CD bullish pattern within 1.1387/1.1408, this is certainly an area the research team anticipates a bounce from should the pair reach this low, targeting January’s opening level mentioned above at 1.1445 as an initial take-profit zone.
As there’s a chance of a fakeout forming beneath the H4 area highlighted above, waiting for the H4 candles to chalk up a bullish candlestick pattern before pulling the trigger is an option. This recognises buyer intent, and at the same time provides entry and stop parameters to work with.
Despite observing a brief flicker of activity around January’s opening level on the H4 timeframe at 1.1445, the single currency yielded ground to its US counterpart Monday.
Clocking lows of 1.1424 amid broad-based USD strength, yesterday’s move exposes a possible AB=CD bullish pattern (black arrows) completion today, positioned just ahead of the 1.14 handle around 1.1408. Note 1.14 is joined by a 50.0% support value at 1.1402 and a nearby 161.8% Fibonacci ext. point at 1.1387: the extreme point of the AB=CD play (yellow).
From the bigger picture a move lower was expected, having seen weekly flow begin fading resistance at 1.1465 and daily movement also tackling resistance at 1.1485. The nearest support target on the higher timeframes can be seen at an ascending channel support (etched from the low 1.1215). It might also be worth pointing out should H4 price connect with its yellow zone between 1.1387/1.1408, the market may witness a mild fakeout through this area to bring in daily buyers off the nearby aforementioned ascending channel support.
Areas of consideration:
In the event the analysis proves accurate and the market completes its H4 AB=CD bullish pattern within 1.1387/1.1408, this is certainly an area the research team anticipates a bounce from should the pair reach this low, targeting January’s opening level mentioned above at 1.1445 as an initial take-profit zone.
As there’s a chance of a fakeout forming beneath the H4 area highlighted above, waiting for the H4 candles to chalk up a bullish candlestick pattern before pulling the trigger is an option. This recognises buyer intent, and at the same time provides entry and stop parameters to work with.
IC Markets is an online forex broker specialized in providing transparent trading solutions to both retail and institutional investors alike. We provide superior execution technology, lower spreads and unrivaled liquidity.