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EUR/USD Mid-Session Technical Analysis for April 22, 2020

By:
James Hyerczyk
Published: Apr 22, 2020, 13:36 UTC

Based on the early price action and the current price at 1.0861, the direction of the EUR/USD the rest of the session on Wednesday is likely to be determined by trader reaction to the minor top at 1.0897 and the minor bottom at 1.0812.

EUR/USD euro dollar

The Euro is trading slightly better on Wednesday as investor sentiment shifted enough to make the U.S. Dollar a less-attractive safe-haven asset. Firmer equity prices and a stable oil market also helped underpin the single-currency. Furthermore, the currency remained rangebound before a European Union meeting on Thursday to discuss financial aid in the Euro Zone.

At 13:11 GMT, the EUR/USD is trading 1.0861, up 0.0004 or +0.03%.

In other news, the Euro Zone economy is already in its deepest recession on record, according to a Reuters poll of economists, who have stuck to a bleak outlook and worry the downturn might be even worse as coronavirus lockdowns across the bloc take their toll.

That comes despite the European Central Bank pledging to buy more than 1 trillion Euros in assets this year to cushion the blow and governments outlining hundreds of billions in spending plans to bridge businesses and support workers.

The latest Reuters poll, taken April 14-22, showed the bloc’s economy contracting by 3.1% in the first quarter and 9.6% in the current quarter. That compares with 3.3% and 9.3% contractions, respectively, predicted in a poll published on April 3.

Daily EUR/USD

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.0812 will signal a resumption of the downtrend. The main trend will change to up on a move through 1.0991.

The minor trend is also down. A trade through 1.0897 will change the minor trend to up. This will shift momentum to the upside.

The main range is 1.0636 to 1.1147. The market is currently trading inside its retracement zone at 1.0892 to 1.0831. This zone is controlling the near-term direction of the EUR/USD.

The short-term range is 1.1147 to 1.0768. Its retracement zone at 1.0958 to 1.1002 is resistance. This zone stopped the rally at 1.0991 recently.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 1.0861, the direction of the EUR/USD the rest of the session on Wednesday is likely to be determined by trader reaction to the minor top at 1.0897 and the minor bottom at 1.0812.

Taking out 1.0897 will indicate the presence of buyers. This could trigger a surge into 1.0958.

A sustained move under 1.0812 will signal the presence of sellers. This could trigger an acceleration to the downside with the main bottom at 1.0768 the next likely downside target.

Watch the price action and read the order flow on these breakouts. They always work better when there is above average volume.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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