EUR/USD technical outlook...
EUR/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
May, as you can see, recovered off worst levels out of demand from 1.0488/1.0912.
June extended gains to highs at 1.1422, though mid-month ran into opposition at the lower ledge of supply from 1.1857/1.1352 (unites with long-term trendline resistance [1.6038]).
With reference to the primary trend, the pair has exhibited clear lower peaks and troughs since 2008.
Daily timeframe:
Brought forward from previous analysis -
The month of June observed EUR/USD address a potential reversal zone (PRZ), derived from a harmonic bearish bat pattern. The base is comprised of an 88.6% Fib level at 1.1395, a 161.8% BC projection at 1.1410 and a 161.8% Fib ext. level at 1.1462 (red oval).
It’s typical, in the case of bearish formations, to see traders sell PRZs and place protective stop-loss orders above the X point (1.1495). Common take-profit targets fall in at the 38.2% and 61.8% Fib levels (of legs A/D) at 1.1106 and 1.0926, respectively.
As you can see, the aforesaid Fib targets have yet to be met.
H4 timeframe:
Partially altered from previous analysis -
Mid-way through London on Wednesday, demand from 1.1189/1.1158 (prior supply) re-entered the scene and fashioned a hammer candlestick formation (considered a bullish signal), putting forward a moderately bullish tone into the close.
Channel resistance is in sight as the next available upside target (1.1422), followed by resistance at 1.1348.
Failure to uphold current demand could result in another layer of demand making a show at 1.1115/1.1139, an area sharing space closely with channel support (1.1168).
H1 timeframe:
In conjunction with yesterday’s hammer candlestick pattern on the H4, Wednesday also brought through a H1 hammer candlestick formation out of demand at 1.1181/1.1202 (glued to the upper edge of H4 demand at 1.1189/1.1158). This, as you can see, threw price above the 100-period simple moving average and the 1.1250 level. Notice the latter is currently holding as support.
Above 1.1250, a rally-base-drop supply can be viewed at 1.1288/1.1278 (boasting strong downside momentum out of its base).
Structures of Interest:
Partially altered from previous analysis -
Monthly supply at 1.1857/1.1352 emphasises a bearish tone in this market, while the daily chart reminds traders there’s also scope for a drop to the 38.2% Fib level at 1.1106.
The H4 timeframe continues to dance with demand at 1.1189/1.1158, with H1 rebounding from 1.1250 as support and throwing light on supply at 1.1288/1.1278. Sellers may want to exercise caution at the aforesaid supply, due to the threat of a whipsaw to 1.13, a level that joins with H4 channel resistance (1.1422). 1.13, therefore, makes for an interesting base for sellers.
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
May, as you can see, recovered off worst levels out of demand from 1.0488/1.0912.
June extended gains to highs at 1.1422, though mid-month ran into opposition at the lower ledge of supply from 1.1857/1.1352 (unites with long-term trendline resistance [1.6038]).
With reference to the primary trend, the pair has exhibited clear lower peaks and troughs since 2008.
Daily timeframe:
Brought forward from previous analysis -
The month of June observed EUR/USD address a potential reversal zone (PRZ), derived from a harmonic bearish bat pattern. The base is comprised of an 88.6% Fib level at 1.1395, a 161.8% BC projection at 1.1410 and a 161.8% Fib ext. level at 1.1462 (red oval).
It’s typical, in the case of bearish formations, to see traders sell PRZs and place protective stop-loss orders above the X point (1.1495). Common take-profit targets fall in at the 38.2% and 61.8% Fib levels (of legs A/D) at 1.1106 and 1.0926, respectively.
As you can see, the aforesaid Fib targets have yet to be met.
H4 timeframe:
Partially altered from previous analysis -
Mid-way through London on Wednesday, demand from 1.1189/1.1158 (prior supply) re-entered the scene and fashioned a hammer candlestick formation (considered a bullish signal), putting forward a moderately bullish tone into the close.
Channel resistance is in sight as the next available upside target (1.1422), followed by resistance at 1.1348.
Failure to uphold current demand could result in another layer of demand making a show at 1.1115/1.1139, an area sharing space closely with channel support (1.1168).
H1 timeframe:
In conjunction with yesterday’s hammer candlestick pattern on the H4, Wednesday also brought through a H1 hammer candlestick formation out of demand at 1.1181/1.1202 (glued to the upper edge of H4 demand at 1.1189/1.1158). This, as you can see, threw price above the 100-period simple moving average and the 1.1250 level. Notice the latter is currently holding as support.
Above 1.1250, a rally-base-drop supply can be viewed at 1.1288/1.1278 (boasting strong downside momentum out of its base).
Structures of Interest:
Partially altered from previous analysis -
Monthly supply at 1.1857/1.1352 emphasises a bearish tone in this market, while the daily chart reminds traders there’s also scope for a drop to the 38.2% Fib level at 1.1106.
The H4 timeframe continues to dance with demand at 1.1189/1.1158, with H1 rebounding from 1.1250 as support and throwing light on supply at 1.1288/1.1278. Sellers may want to exercise caution at the aforesaid supply, due to the threat of a whipsaw to 1.13, a level that joins with H4 channel resistance (1.1422). 1.13, therefore, makes for an interesting base for sellers.
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