The euro made considerable ground against its US counterpart on Wednesday, running through both October’s opening level seen on the H4 timeframe at 1.1788 and, after the release of the FOMC minutes, the 1.18 handle. According to the minutes, the majority of the FOMC members saw that a near-term hike was warranted, but few opposed.
As you can see on the daily timeframe, recent action saw price chalk up a near-full-bodied bull candle from a trendline support etched from the high 1.2092. To the upside, however, there is a nearby well-appointed resistance level pegged at 1.1878. Against this background, nonetheless, we can see that weekly action pushed into the walls of a supply base drawn from 1.1880-1.1777. A breach of this zone would likely throw resistance at 1.2044 back onto the radar.
Suggestions: We like the idea of a bounce being seen from 1.1788/1.18 on the H4 timeframe (Oct’s open level/round number – green zone), since there is room for the unit to advance north on the daily timeframe. The only grumble here, of course, is the current weekly supply!
Unfortunately, a long from 1.1788/1.18 would be too much of a risk for our liking. However, if you have faith in the area, we would strongly advise waiting for additional confirmation in the form of a full or near-full-bodied H4 bull candle. This will help avoid an unnecessary loss should price decide to dip lower.
Data points to consider: Eurozone manufacturing 8/9am; UK growth data at 9.30am; ECB monetary policy meeting accounts at 12.30 GMT; US banks will be closed in observance of Thanksgiving Day.
As you can see on the daily timeframe, recent action saw price chalk up a near-full-bodied bull candle from a trendline support etched from the high 1.2092. To the upside, however, there is a nearby well-appointed resistance level pegged at 1.1878. Against this background, nonetheless, we can see that weekly action pushed into the walls of a supply base drawn from 1.1880-1.1777. A breach of this zone would likely throw resistance at 1.2044 back onto the radar.
Suggestions: We like the idea of a bounce being seen from 1.1788/1.18 on the H4 timeframe (Oct’s open level/round number – green zone), since there is room for the unit to advance north on the daily timeframe. The only grumble here, of course, is the current weekly supply!
Unfortunately, a long from 1.1788/1.18 would be too much of a risk for our liking. However, if you have faith in the area, we would strongly advise waiting for additional confirmation in the form of a full or near-full-bodied H4 bull candle. This will help avoid an unnecessary loss should price decide to dip lower.
Data points to consider: Eurozone manufacturing 8/9am; UK growth data at 9.30am; ECB monetary policy meeting accounts at 12.30 GMT; US banks will be closed in observance of Thanksgiving Day.
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