EUR/USD Mid-Session Technical Analysis for December 18, 2018

The Euro is surging on Tuesday on aggressive position-squaring ahead of the start of the Federal Open Market Committee’s two-day meeting. Traders are also responding to a drop in U.S. Treasury yields. The Euro is being supported by speculation that signs of economic turbulence may prompt Federal Reserve policymakers to put the brakes soon on its monetary tightening cycle.

At 1134 GMT, the EUR/USD is trading 1.1398, up 0.0049 or +0.43%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1444 will negate a recent closing price reversal top and change the main trend to up. A move through 1.1270 will signal a resumption of the downtrend.

Over the last two trading sessions, buyers have also chewed through a few retracement levels that have been acting like support and resistance for over a month.

Daily Swing Chart Technical Forecast

Based on the current price at 1.1398, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to the Fibonacci level at 1.1395.

Bullish Scenario

A sustained move over 1.1395 will indicate the presence of buyers. If this move creates enough upside momentum then we could see an acceleration to the upside with the first potential target a resistance cluster at 1.1444 to 1.1447.

Bearish Scenario

A sustained move under 1.1395 will signal the presence of sellers. This could lead to a labored break with potential support levels layered at 1.1370, 1.1345 and 1.1315.

The trend may be down, but the Euro has a potential fundamental catalyst that could finally take it out of its month-long range.