EUR/USD Mid-Session Technical Analysis for April 5, 2018

The EUR/USD is trading lower shortly before the U.S. opening, but it’s trying to claw back from early session weakness that drove it into 1.2248. The catalyst behind the early sell-off was the easing of tensions over a possible trade war between the United States and China. This news helped make the U.S. Dollar a more attractive investment.

Position-squaring ahead of today’s economic data and Friday’s U.S. Non-Farm Payrolls report could trigger a two-sided trade today.

At 1006 GMT, the EUR/USD is trading 1.2275, down 0.0003 or -0.03%.

Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of a closing price reversal top at 1.2476 on March 27.

A trade through 1.2239 will change the main trend to down.

The minor trend is down. A move through 1.2345 will change the main trend to up.

Today is the seventh day down from the last main top. This puts the EUR/USD in the window of time for a closing price reversal bottom.

The nearest support is a 50% level at 1.2235. This is followed by a support cluster at 1.2166 to 1.2160.

Daily Technical Forecast

Based on the early price action, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to the uptrending Gann angle at 1.2278.

A sustained move under 1.2278 will indicate the presence of sellers. If this move generates enough downside momentum then we should see a retest of today’s low at 1.2248. This is followed by 1.2239 then 1.2235. If this level fails then look for the selling to extend into the next uptrending Gann angle at 1.2216. This is the last potential support angle before 1.2166, 1.2160 and 1.2153.

A sustained move over 1.2278 will signal the presence of buyers. This could trigger an acceleration to the upside with the next target coming in at 1.2336.