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James Hyerczyk

The Euro is trading slightly lower against the U.S. dollar on Monday, but inside Friday’s range. The move suggests investor indecision. It could also be an early indication that traders are preparing to transition from short to long. The chart pattern, however, does not indicate an impending change in trend.

On the economic front, there are no major reports out of the United States on Monday, but earlier in the session reports on German Factory Orders and Sentix Investor Confidence were released.

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At 11:39 GMT, the EUR/USD is trading 1.0799, down 0.0015 or -0.14%.

Earlier today, Kit Juckes, Societe Generale’s macro strategist said the game-changer for the Euro “would be a more toward some version of ‘Coronabonds’ at tomorrow’s Eurogroup meeting”.

“Absent that, I’m not sure the Euro has much home-grown potential to bounce,” he said.

Euro Zone finance ministers are likely to converge on Tuesday on three quick options to support the economy during the coronavirus epidemic.


Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.0636 will signal a resumption of the downtrend. A move through 1.1147 will change the main trend to up.

The main range is 1.1496 to 1.0636. Its retracement zone at 1.1066 to 1.1167 is resistance. This zone stopped the buying at 1.1147 on March 27.

The short-term range is 1.0636 to 1.1147. Its retracement zone is 1.0892 to 1.0831. Trading below this zone makes it resistance.


Daily Technical Forecast

Based on the early price action and the current price at 1.0799, the direction of the EUR/USD is likely to be determined by trader reaction to the short-term Fibonacci level at 1.0831.

Bearish Scenario

A sustained move under 1.0831 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into the next uptrending Gann angle at 1.0736.

A failure to hold 1.0736 is likely to lead to a test of the next uptrending Gann angle at 1.0686. This is the last potential support angle before the 1.0636 main bottom.

Bullish Scenario

Overtaking 1.0831 will signal the presence of buyers. Overcoming the uptrending Gann angle at 1.0836 will indicate the buying is getting stronger. This could trigger a surge into the short-term 50% level at 1.0892, followed by a downtrending Gann angle at 1.0907.

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