EUR/USD Mid-Session Technical Analysis for July 16, 2021

The Euro is trading nearly flat following the release of a report that showed Euro Zone inflation slowed in June after a steady acceleration in the first months of 2021. Meanwhile, official data confirmed on Friday the bloc’s trade surplus shrank in May due to a decline of exports.

At 10:31 GMT, the EUR/USD is trading 1.1805, down 0.0007 or -0.06%.

The European Union’s statistics office Eurostat said consumer prices in the 19-country single-currency bloc rose 1.9% in June on the year, slightly less than the 2.0% increase in May, in the first slowdown since last September. The final data confirmed an initial estimate released by Eurostat on June 30.

In a separate release, Eurostat said that the Euro Zone trade balance in goods with the rest of the world recorded a smaller surplus in May than in April. In May, the bloc exported goods worth 188.2 billion Euros ($222 billion) and imported 180.7 billion Euros of goods, for a surplus of 7.5 billion Euros.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, the formation of a closing price reversal bottom on July 14 and its subsequent confirmation on July 15 suggests momentum may be getting ready to shift to the upside.

A trade through 1.1881 will change the main trend to up, while a move through 1.1772 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The minor range is also down. A trade through 1.1796 will make 1.1851 a new main top. Taking out this level will confirm the shift in momentum.

The minor range is 1.1881 to 1.1772. The EUR/USD is currently trading on the weak side of its pivot at 1.1827.

The short-term range is 1.1975 to 1.1772. Its retracement zone at 1.1873 to 1.1898 is potential resistance. The upper or Fibonacci level at 1.1898 is a potential trigger point for an acceleration to the upside.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD into the close on Friday is likely to be determined by trader reaction to 1.1827.

Bearish Scenario

A sustained move under 1.1827 will indicate the presence of sellers. This could trigger a break into 1.1772. Taking out this level will reaffirm the downtrend with 1.1704 the next likely target.

Bullish Scenario

A sustained move over 1.1827 will signal the presence of buyers. This could trigger a surge into a cluster of levels at 1.1873, 1.1881, 1.1895 and 1.1898. The latter is a potential trigger point for an acceleration to the upside with 1.1975 the next likely target.