EUR/USD Mid-Session Technical Analysis for July 15, 2019

The Euro is inching higher on Monday on low volume. Traders are reacting to the lack of news from the Euro Zone. At 12:30 GMT, traders will get an opportunity to react to the Empire State Manufacturing Index. It is expected to come in at 1.6, better than last month’s minus 8.6 reading. This report is important because it could influence Fed policy.

At 11:10 GMT, the EUR/USD is trading 1.1276, up 0.0005 or +0.05%.

Going into today’s session, the markets have priced in a 100% chance of a 25-basis point rate cut by the Fed on July 31. The issue for traders is whether there will be a 50-basis point rate cut. Currently, the chances of this is 30%. A bearish Empire State Manufacturing report could drive up the odds of a half-a-point rate hike. This could trigger a surge in the EUR/USD.

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 1.1413 on July 25. A trade through 1.1193 will change the main trend to down, this could lead to a test of the next main bottom at 1.1181. This is a potential trigger point into a pair of main bottoms at 1.1116 to 1.1107.

The minor trend is down. A trade through 1.1286 will change the minor trend to up. This will shift momentum to the upside.

The major retracement zone at 1.1278 to 1.1318 is controlling the longer-term direction of the Forex pair. It is currently acting like resistance.

Daily Technical Forecast

Based on the early price action and the current price at 1.1276, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to the 50% level at 1.1278 and the downtrending Gann angle at 1.1273.

Bullish Scenario

A sustained move over 1.1278 will indicate the presence of buyers. The first target is the minor top at 1.1286. Taking out this level could trigger an acceleration into the Fibonacci level at 1.1318.

Bearish Scenario

A sustained move under 1.1273 will signal the presence of sellers. This could create enough downside momentum to fuel a break into the minor bottom at 1.1238 and the uptrending Gann angle at 1.1233.