Intraday Market Analysis: Magnifying EURUSD Technical Dips

EURUSD Technical Analysis

Euro Dollar has probably been on of the currency pairs in the Foreign Exchange (Forex) market that may have lead some technical traders astray. It all began with the first round of the French elections.

Despite the polls showing the Macron is expected to pass to the second round, concerns it may not be the case triggered a fairly large gap in Euro Dollar at the opening of the Forex market. Once the market realized the polls are credible as opposed to the US elections, when Macron officially won the elections in the second round little reaction was noted. President Donald Trump then injected some volatility into the market by firing the FBI director.

Allegations that Trump’s personnel colluded with Russia has triggered more volatility. which has pressed USD lower against the Euro. Fresh concerns are now present whether the Fed will maintain its projections for more hikes this year or limit the hike to June.

What also catalyzed EURUSD moderate gains is the fact the Euro is benefiting from risk aversion mode, which propelled the currency pairs into fresh highs for the year. We have spotted EURUSD weekly breakout, however, we are less keen on entries where gaps are a factor of the trading strategy.

EURUSD Weekly Chart

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Intraday Market Analysis: Magnifying EURUSD Technical Dips

EURUSD Weekly Chart 20/05/17

EURUSD posted +280 pips (approx.) in a single week, which reflects the geopolitical tension in the US. As you may note, the break above 1.0845 was triggered by a gap. It was later re-tested by the market, which then sprang EURUSD to current levels.

The objective of the current reversal is 1.1280 but initiating a long trade at current levels as no technical support to it and heavily relies on the Fed’s monetary policy. If 1.1280 is tested by the market and is bale to contain EUR strength, it may be a technical level that may be used by forex traders to realize profits and trigger some retracement the current rally. Although it is a weekly resistance is may be used via intraday time frames such as 4hr and 60min.

EURUSD 4hr Chart

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Intraday Market Analysis: Magnifying EURUSD Technical Dips

EURUSD 4hr Chart 20/05/17

EURUSD Intraday Strategy

As we noted earlier, joining the uptrend at current levels has is not supported via technical analysis, a dip is required in order to entertain the possibility of a long position. The 2 potential price levels are 1.1170 and 1.1130. Should Euro Dollar test either levels and post a 4hr close above it may be sufficient to enter the market and target 1.1280.

Our preference would be a successful re-test 1,1130. Should EURUSD maintain its uptrend without correcting lower. 1.1280 is the immediate resistance. EURUSD may require to break below 1.1078 in order to invalidate the bullish, intraday outlook for the currency pair. Multiple strategies may be exercised in Euro Dollar but it greatly depends whether our key levels are tested.

The key economic figures for the Euro are due to be released on Tuesday, the Purchasing Manager’s Index (PMI) and German IFO Business Climate. The market is already anticipating a positive US Gross Domestic Product (GDP) figure on Friday, only a significant deviation from the expectations (positive or negative) may have a moderate impact on EURUSD.

We should highlight this does not conflict our AUDUSD intraday strategy. The Australian Dollar is likely to be more prone to Iron Ore prices.

22/05/17 UPDATE: EURUSD catapulted higher in the FX markets as Angela Merkel stated the Euro is took weak, EUR strength was not limited to Euro Dollar.

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Intraday Market Analysis: Magnifying EURUSD Technical Dips

EURUSD 4hr Chart 22/05/17

The technical rebound occurred off her first key level, 1.1170. The 4hr close was approximately 2 pips below 1.1170, which does not constitute as a breakout. We are aware that in several platforms it may reflect as a successful re-test as there are many price feeds for currency pairs as opposed to stocks for example.

24/05/17 UPDATE: EURUSD missed the daily target by several pips before retracing lower to re-test the 1.1170 support level.

Please click on the chart to enlarge:

Intraday Market Analysis: Magnifying EURUSD Technical Dips

EURUSD 4hr Chart 24/05/17

Moody’s credit rating agency downgraded China earlier today, which had no significant impact on the major currency pairs Foreign Exchange market. Moody’s downgrade may signal S&P may follow suit in the future. Although some of the key levels are still relevant we are unlocking EURUSD intrday strategy to all traders. We will re-assess Euro Dollar and issue a new intraday strategy for the pair.

As all trades are closed this page can now be accessed by all traders. Open trades and relevant intraday strategies are restricted to members only. We have been providing trade alerts in the Forex market since May 2014.
Intraday Market Analysis: Magnifying EURUSD Technical Dips

Last Updated on May 28, 2017