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James Hyerczyk

The Euro is treading water against the U.S. Dollar early Monday in what could become a theme this week until the release of the U.S. Federal Reserve monetary policy statement on Wednesday. There are no major economic reports this week from the Euro Zone. On Tuesday, investors will get the opportunity to react to the Conference Board’s Consumer Confidence report. On Wednesday, before the Fed announcement, the U.S. will release data from ADP on private sector jobs and the ISM Manufacturing PMI.

At 0341 GMT, the EUR/USD is trading 1.1651, down 0.0006 or -0.05%.


Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. However, momentum is trending lower. The clash between the major and minor trends is what is helping to give the EUR/USD a sideways look.

A trade through 1.1751 will signal a resumption of the uptrend. A move through 1.1575 will change the main trend to down.

The minor trend is down. Today’s earlier rally helped make 1.1621 a new minor bottom.

Based on the current price at 1.1651, support is a minor Fib level at 1.1642 and a major Fib level at 1.1617. Resistance is a minor 50% level at 1.1663, and a major 50% level at 1.1680.

Daily EUR/USD (Close-Up)

Daily Swing Chart Technical Forecast

Based on the early trade at 1.1651, the direction of the EUR/USD today is likely to be determined by trader reaction to 1.1663.

A sustained move under 1.1663 will indicate the presence of sellers. This could trigger a move into 1.1642. Look for a steep break if this level fails with targets coming in at 1.1621 then 1.1617.

We could see an acceleration to the downside if 1.1617 fails with 1.1575 the next target.

Overtaking and sustaining a move over 1.1663 will signal the return of buyers. This could lead to a quick test of 1.1680. This is a potential trigger point with 1.1720 the next target.

If volume drops ahead of the Fed announcement on Wednesday, we could see a rangebound trade for a couple of days between 1.1680 and 1.1617.

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