EUR/USD Mid-Session Technical Analysis for February 22, 2019

The Euro is trading mixed on Friday as traders continue to digest yesterday’s European Central Bank Monetary Policy Meeting minutes, while awaiting comments from several Federal Open Market Committee members throughout the session.

Today’s focus will be on Federal Open Market Committee member remarks. Traders don’t expect members, Williams, Clarida, Bullard and Quarles to waiver too much from the Fed’s decision to remain “patient” when making interest rate decisions. Furthermore, we could also find out more information on what the Fed plans to do with its balance sheet. The market expects the Fed to stop reducing its balance sheet, which is viewed as de facto tightening. Halting the practice could weaken the dollar.

At 14:42 GMT, the EUR/USD is trading 1.1334, up 0.0001 or +0.01%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the formation of the closing price reversal top at 1.1371 on February 20. A trade through this level will negate the reversal top and signal a resumption of the uptrend. The main trend will change to down on a move through 1.1234.

The main range is 1.1514 to 1.1234. Its retracement zone at 1.1374 to 1.1407 is the primary upside target. This zone is controlling the near-term direction of the Forex pair.

The short-term range is 1.1234 to 1.1371. If the selling pressure continues then look for a pullback into its retracement zone at 1.1303 to 1.1286. Since the main trend is up, buyers may come in on a test of this zone.

Daily Technical Forecast

Based on the early price action, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to the uptrending Gann angle at 1.1334.

Bullish Scenario

A sustained move over 1.1334 will indicate the presence of buyers. This could trigger a move into a downtrending Gann angle at 1.1354. This angle has provided resistance the last two day. Overtaking the angle could trigger a surge into $1.1371 to 1.1374. The latter is a potential trigger point for an acceleration to the upside with the next target the Fibonacci level at 1.1407.

Bearish Scenario

A sustained move under 1.1334 will signal the presence of sellers. The daily chart is wide open under this Gann angle with the next target a retracement zone at 1.1303 to 1.1286, followed by an uptrending Gann angle at 1.1284.