The direction of the EUR/USD will be determined by trader reaction to the pivot at 1.1746.
The Euro is trading lower against the U.S. Dollar on Monday in a limited trade as Europe remains closed because of an extended Easter holiday. The single-currency remains within striking distance of a five-month high hit last week.
Pressuring the common currency is Friday’s blowout U.S. jobs report that showed the nation’s labor market is recovering from the impact of the coronavirus shock.
At 11:42 GMT, the EUR/USD is trading 1.1757, down 0.0005 or -0.05%.
The focus now shifts to data on the U.S. services sector due later on Monday, which is forecast to show an acceleration in activity that could further encourage dollar bulls. ISM Services PMI is expected to come in at 58.3, up from 55.3. Factory Orders are expected to dip slightly.
The main trend is down according to the daily swing chart. A trade through 1.1704 will reaffirm the downtrend. The main trend will change to up on a move through 1.1989.
The minor trend is also down, a trade through 1.1787 will change the minor trend to up. This will also shift momentum to the upside.
The minor range is 1.1704 to 1.1787. The EUR/USD is currently straddling its 50% level at 1.1746.
The short-term range is 1.1989 to 1.1704. Its 50% level at 1.1847 is the first upside target.
The second potential upside target is the retracement zone at 1.1888 to 1.1976.
The direction of the EUR/USD will be determined by trader reaction to the pivot at 1.1746.
A sustained move over 1.1746 will indicate the presence of buyers. The first upside target is the minor top at 1.1787. Taking out this level could trigger a surge into the short-term 50% level at 1.1847, followed by the main Fibonacci level at 1.1888.
A sustained move under 1.1746 will signal the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into the main bottom at 1.1704. Taking out this level will reaffirm the downtrend and could trigger an acceleration into the November 4, 2020 main bottom at 1.1603.
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.