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EUR/USD Mid-Session Technical Analysis for August 27, 2020

By:
James Hyerczyk
Published: Aug 27, 2020, 16:22 UTC

The formation of the secondary lower top at 1.1902 indicates the EUR/USD may be getting ready to rollover to the downside.

EUR/USD

The Euro is trading lower against the U.S. Dollar at the mid-session on Thursday after reversing earlier gains. The single-currency began to weaken after Federal Reserve Chairman Jerome Powell said, as widely expected, that the U.S. central bank would roll out an aggressive new strategy to lift U.S. employment and inflation.

At 15:58 GMT, the EUR/USD is trading 1.1792, down 0.0039 or -0.33%. This is down from a high of 1.1902.

Under the new approach, the U.S. central bank will seek to achieve inflation averaging 2% over time, offsetting below-2% periods with higher inflation “for some time,” and to ensure employment does not fall short of its maximum level.

Daily EUR/USD

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but momentum may be shifting to the downside with the formation of a secondary lower top at 1.1902.

A trade through 1.1966 will signal a resumption of the uptrend. A move through 1.1755 will change the main trend to down.

The minor trend is also up. A trade through 1.1883 earlier today changed the minor trend to up just a few days after the minor trend changed to down.

The first minor range is 1.1966 to 1.1755. Its retracement zone at 1.1860 is resistance.

The second minor range is 1.1696 to 1.1966. With the Euro now on the weak side of its 50% level, 1.1831 is additional resistance.

The short-term range is 1.1371 to 1.1966. If the main trend changes to down then look for the selling to possibly extend into its retracement zone at 1.1668 to 1.1598.

Daily Swing Chart Technical Forecast

Look for the downside momentum to continue into the close on Thursday as long as the EUR/USD remains under 1.1831. If this move is able to lead to increased selling pressure then look for the Forex pair to eventually challenge the main bottom at 1.1755.

The formation of the secondary lower top at 1.1902 indicates the EUR/USD may be getting ready to rollover to the downside.

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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