• Pair broke the 1.1500 psychological level which turned into resistance now.
• Downtrend resumed, bears targeting lower levels.
• First resistance is the red descending trend line support turned resistance just below 1.1500.
• Next target/support is at 1.14220, 1.1330 after that and last but not least 1.1170.
• Triangle pattern on daily chart
• Breakout can be to the upside or downside
• In this case, breakout was on the downside
• How to set the price target?
1- Measure the difference between the lowest and highest point in the triangle
2- Project it from the breakout point
• As illustrated on the chart, the price range of the triangle, projected from the breakout...
• Higher highs, higher lows since Sep 21, so the trend is bullish
• However, a small correction is expected, first target/support is the 38,2% level at 3750.
• Followed by the ascending trend line support, today at 3200.
• Upside is capped by the critical resistance at 4380 which is a double top, until now.
As previously anticipated, months ago, the downtrend for the pair is back in play following a positive shift in the Fed's policy and forecast for the us economy.
• The pair is bullish short term, trading inside an upside parallel channel.
• Next resistance is the weekly high at 1.1670.
• Second next resistance is somewhere near 1.1720...
• Pair broke above the June-July descending trend line
• Trading inside a falling wedge
• Falling wedge is a reversal bullish pattern
• Expect upward move in the short term
• Long at the breakout of the wedge with Tp at 1.2000
• EUR/USD found support near support line at 1.17700 dating back from Nov 2020.
• Bull candle today met some resistance near descending trend line in play since June 25.
• More likely, the pair will break the support line and test yearly lows near 1.1700.
• Bearish case in play.
Trading recommendations for the pair.
1st scenario: Long at 1.1770 support line (weekly still bullish since we are still in the higher lows pattern), with Stop loss just below the line and first target at 1.200
2nd scenario: Short below the orange line on a break below it (which turns it to a resistance) with stop loss just above it. First target at 1.1700 and...
Explaining support and resistance trading in this idea
• Always Buy on support levels, sell at resistance levels.
• This chart helps you identify support and resistance and how to trade them.
• April 2021 EUR/USD hit a low of 1.1700 psychological level (which is a support), therefore it's a Buy signal.
• The pair tested 1.2150 resistance and retraced after it.
• Three important support levels
• From least critical to most critical (Yellow-orange-red)
• Yellow: Mar 20 lows - Mar 21 lows is already broken
• Orange: Nov 20 lows - Apr 21 lows today at 1.1750
• Red: Horizontal support Nov 20 lows - Sep 20 lows at 1.1600
• A trend line is a line drawn over pivot highs or under pivot lows to show the prevailing direction of price.
• Trend lines are a visual representation of support and resistance in any time frame.
• They show direction of the market and intensity of the move.
Illustrated above is an example of 2 types of trend lines: Ascending and descending.
I am back sharing my ideas and analyses after being away for a while.
Let's recap the market in the recent past.
EUR/USD was benefiting from a weak dollar in the past few months, following a dovish Fed and ignorance of economic recovery signs in the US vs Europe and insistence of proceeding with a loose policy stance.
However, the whole picture...
• Bullish trend on the short term
• Fundamentals point to a bearish trend long term
• From a technical perspective:
• Pair is trading near the 50% retracement level of March and the critical horizontal resistance at 1.1980-90
• Next target upside is the 61,8% level near 1.2030
• Falling wedge breakout is causing prices to rise
• In my opinion, if prices keep on...
• Confined in an ascending parallel channel since March 2020 (beginning of the Covid-19 pandemic)
• Bulls in control after easing of 10-Y yields
• Test of the descending trend line since 2017 on the table ( around 1.1880-1.18090) where also sits the 100 SMA
• Overall trend remains bearish
• Fundamentals in favor of the USD