ICmarkets
Short

Our take on the EUR this week...

FX:EURUSD   Euro Fx/U.S. Dollar
172 0 3
Weekly gain/loss: + 212 pips
Weekly closing price: 1.1167
Weekly opening price: 1.1169

Weekly view: From this viewpoint, the EUR/USD             appears to be heading back up to retest the weekly resistance area chalked in at 1.1533-1.1278. This zone has certainly stood the test of time, capping upside since May 2015. Therefore, do keep a close eye on this barrier as it will likely play a significant role in this market over the next few weeks!

Daily view: Thanks to a healthy bounce from the daily support area at 1.0909-1.0982, the pair is now seen trading at the top end of a daily resistance zone penciled in at 1.1224-1.1104. Should the bulls continue to dominate this week, the 1.1446-1.1369 area (a daily supply) will likely be the next objective to reach.

H4 view: A lower than expected US GDP print boosted EUR appeal mid-way through the London session on Friday, eventually forcing price to close the week slightly above H4 resistance at 1.1162 (now acting support).

Direction for the week: A whipsaw through the aforementioned daily resistance area at 1.1224-1.1104 will likely take place in order for price to shake hands with the weekly resistance zone mentioned above at 1.1533-1.1278. To our way of seeing things, however, this should eventually send the EUR lower.

Direction for today: Although the higher-timeframe picture indicates that we may see a push up to the 1.1278 region this week, there’s a particularly attractive H4 resistance level at 1.1237 which has caught our eye. Strengthened by a H4 61.8% Fib at 1.1231 along with a H4 trendline swap taken from the low 1.1069 (green circle), a bounce is likely from this region today should price cut through offers at the 1.12 handle.

Our suggestions: Watch for a sell (preferably with lower timeframe confirmation) trade around the above said H4 resistance level today. As we’ve already mentioned, do keep in mind that we’re only expecting a bounce from here due to what’s been noted on the higher-timeframe picture (see above). As for targets, we’d be looking to cover some of the position around 1.12, and if price extends further south, the H4 support at 1.1162 would be the next barrier on the hit list.
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