EUR/USD Mid-Session Technical Analysis for August 8, 2019
Based on the early price action, the direction of the EUR/USD is likely to be determined by trader reaction to the Fibonacci level at 1.1185.
The Euro is easing against the U.S. Dollar on Thursday shortly after the U.S. session open. However, the single-currency remains inside Tuesday’s and Wednesday’s range, which suggests investor indecision and impending volatility. After a recent four day rally, gains have been capped since losses in the Chinese yuan have been curbed.
At 12:00 GMT, the EUR/USD is trading 1.1186, down 0.0012 or -0.11%.
Increasing demand for risk is also helping to drive investors into the higher-yielding U.S. Dollar. Risk sentiment rose after the release of better-than-expected Chinese trade data. Beijing also made efforts to slow the slide in the value of the yuan.
Daily Technical Analysis
The main trend is down according to the daily swing chart, however, momentum has been trending higher since the formation of the closing price reversal bottom at 1.1027 on August 1. Capping gains this week has been the minor closing price reversal top at 1.1250.
The main trend will change to up on a trade through 1.1282. This is followed closely by another main top at 1.1286. This is a potential trigger point for an acceleration into the next main top at 1.1413.
On the downside, a trade through 1.1027 will negate the closing price reversal bottom and signal a resumption of the downtrend.
The main range is 1.1413 to 1.1027. Its retracement zone at 1.1220 to 1.1265 is resistance. This zone stopped the rally at 1.1250 on August 6.
Support is the long-term Fibonacci level at 1.1185.
The short-term range is 1.1027 to 1.1250. If sellers take control then look for a test of its retracement zone at 1.1139 to 1.1112.
Daily Technical Forecast
Based on the early price action, the direction of the EUR/USD is likely to be determined by trader reaction to the Fibonacci level at 1.1185.
Bearish Scenario
A sustained move under 1.1185 will indicate the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into the short-term 50% level at 1.1139, followed by the uptrending Gann angle at 1.1127. Buyers could come in on a test of this area since they will be trying to form a secondary higher bottom.
Bullish Scenario
A sustained move over 1.1185 will signal the presence of buyers. However, any rally is likely to be labored due to potential resistance at 1.1212, 1.1220 and 1.1227.
The buying could pick up on a move over 1.1227 with potential targets coming in at 1.1250, 1.1253 and 1.1265.
The EUR/USD starts to open up over 1.1265.
