EUR/USD Mid-Session Technical Analysis for July 12, 2021

The Euro is trading lower on Monday in light trading ahead of Tuesday’s U.S. consumer inflation report. The currency is trading inside Friday’s range that tends to indicate investor indecision and impending volatility. Helping to underpin the single currency are lower Treasury yields. Meanwhile, the U.S. Dollar is edging higher against a basket of major currencies.

Renewed concerns about the pandemic is driving the cautious trade, while investors waited for more clues about the global economic recovery before making their next moves. There were no major economic releases from the Euro Zone overnight.

At 12:42 GMT, the EUR/USD is trading 1.1855, down 0.0022 or -0.19%.

Economists polled by Reuters expect U.S. consumer inflation for June to have risen 0.4% from May and 4.0% from a year earlier after two straight months of sharp gains in prices.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1895 will change the main trend to up. A move through 1.1782 will signal a resumption of the downtrend.

The minor range is 1.1895 to 1.1782. Its 50% level at 1.1839 is support.

The short-term range is 1.1975 to 1.1782. Its retracement zone at 1.1879 to 1.1901 is acting like resistance. However, it’s also the trigger point for an acceleration to the upside.

Daily Swing Chart Technical Forecast

With the main trend down, the direction of the EUR/USD on Monday will be determined by trader reaction to 1.1879.

Bearish Scenario

A sustained move under 1.1879 will indicate the presence of sellers. The first downside target is the pivot at 1.1839. Taking out this level with conviction could trigger a further break into the main bottom at 1.1782.

The main bottom at 1.1782 is a potential trigger point for an acceleration into the March 31 main bottom at 1.1704. For many analysts, this is the primary downside target so don’t be surprised by new buyers.

Bullish Scenario

Holding 1.1839 will signal the presence of buyers, while a sustained move over 1.1879 will indicate the buying is getting stronger. This could generate the upside momentum needed to overtake the main top at 1.1895 and the short-term Fibonacci level at 1.1901.

The Fib level at 1.1901 is a potential trigger point for an acceleration to the upside with 1.1975 the next major target.