Looking to short 1.1830 at AB=CD confluence...

The euro made considerable ground against its US counterpart on Wednesday, despite US durable goods and new home sales figures reporting better-than-expected numbers. H4 price broke through both October’s opening level at 1.1788 and the 1.18 handle, with the pair now looking poised to challenge August’s opening level coming in at 1.1830.

1.1830, as you can probably see on the H4 chart, is an appealing line. Besides merging nicely with a trendline resistance extended from the high 1.1880, it boasts a 78.6% Fib resistance and an AB=CD (black arrows) 161.8% Fib ext. at 1.1833. In addition to this, there’s also a nearby channel resistance seen on the daily timeframe etched from the high 1.2092. The only grumble we have here is the weekly timeframe seen hovering above support at 1.1714.

Suggestions: Should H4 price connect with the yellow marker sometime today, our team would look to short at 1.1830 (stops planted 20 pips higher), targeting 1.18 as an initial take-profit target. Yes, this may be a risky move considering where price is positioned on the weekly timeframe, but we feel the confluence surrounding August’s opening line will at least bounce price back down to the 1.18 neighborhood.

Data points to consider: Spanish unemployment rate at 8am; EUR M3 money supply y/y at 9am; EUR minimum bid rate at 12.45pm; ECB press conference at 1.30pm; US unemployment claims at 1.30pm; US pending home sales m/m at 3pm GMT+1.