EUR/USD Bears Getting Closer To The Key Support Level
Morning Brief
European indices opened lower today, following mixed performance on Wall Street and gains in Asia. Despite this, UK employment data exceeded expectations, boosting the GBP market. Conversely, lower-than-expected Swiss CPI readings pressured the CHF. Notably, the German ZEW index for February and US CPI inflation reading for January are awaited.
Technical Market Outlook
The EUR/USD pair's bounce was limited near 1.0806, just 4 pips shy of the 50% Fibonacci retracement level. Bears are exerting pressure near the 100 DEMA at 1.0822. Intraday support lies at 1.0763, with momentum testing the fifty level. Bulls seek a breakout above 1.0810 for upward momentum, eyeing the supply zone between 1.0898 - 1.0890.
H4 Time Frame Technical Insights
Candlestick Patterns: 'Hammer' patterns suggest bullish reversals, while a 'Shooting Star' indicates bearish sentiment. 'Bearish Engulfing' patterns hint at potential reversals.
Moving Averages: The price resides between the 50-period Double Exponential Moving Average (DEMA) and 100-period Exponential Moving Average (EMA), signaling potential resistance (EMA) and support (DEMA).
Technical Indicators: The Relative Strength Index (RSI) at 51.28 indicates a neutral market, neither overbought nor oversold.
Trendlines and Price Channels: The ascending channel suggests a short-term bullish trend with forming higher lows. However, the upper boundary could act as resistance.
EUR/USD H1 Intraday Indicator Analysis
- Technical Indicators: 13 out of 22 signals Sell, 1 Buy, and 8 Neutral.
- Moving Averages: 14 out of 18 indicate Sell, 4 Buy.
Sentiment Scoreboard
Bullish sentiment prevails (59% vs. 41% bears), consistent with last week's sentiment (61% bulls vs. 39% bears). However, the sentiment in the last three days is neutral (50% bulls vs. 50% bears).
Weekly Pivot Points
- WR3 - 1.08296
- WR2 - 1.08114
- WR1 - 1.07992
- Weekly Pivot - 1.07932
- WS1 - 1.07810
- WS2 - 1.07750
- WS3 - 1.07568
EUR/USD Bullish Scenario
Continued respect for the ascending channel's support line could signal ongoing bullish momentum. A breakout above the 100-period EMA and upper channel line might suggest a stronger upward move, targeting previous highs.
EUR/USD Bearish Scenario
Respect for reversal patterns like the 'Shooting Star' and 'Bearish Engulfing' could lead to a downside reversal. A break below the ascending channel and 50-period DEMA could open the way to lower support levels.
Trading Insights
The market stands at a pivotal moment, with potential for both bullish and bearish movements. Traders should watch for confirmation signals, apply prudent risk management, and consider broader macroeconomic factors influencing the currency pair.
Useful Links
Important Notice
The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.
Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.
