EUR/USD Mid-Session Technical Analysis for March 11, 2019

The Euro is trading higher on Monday shortly before the U.S. opening. The price action is likely being fueled by short-covering in reaction to oversold conditions caused by last week’s steep sell-off. The dovish signals from the European Central Bank last week are controlling the longer-term price action so we don’t expect this rally to last very long.

At 11:57 GMT, the EUR/USD is trading 1.1254, up 0.0021 or +0.18%.

We could also be looking at position-paring following Friday’s mixed U.S. employment data. The report suggests the U.S. economy may be softening, but based on last week’s announcement of new stimulus measures by the ECB and its growth downgrade, the Euro Zone economy is the weaker of the two.

Look for some volatility following the release of the U.S. retail sales report at 12:30 GMT especially if the report comes out weaker than expected. Core Retail Sales are expected to have risen 0.4%, while Retail Sales are expected to come in flat.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1176 will signal a resumption of the downtrend.

The EUR/USD is in no position to change the main trend to up, however, there is room for a normal 50% to 61.8% retracement.

The short-term range is 1.1420 to 1.1176. Its retracement zone at 1.1298 to 1.1327 is the primary upside target. Since the main trend is down, look for sellers to come in on a test of this zone.

On the downside, the nearest support is the long-term Fibonacci level at 1.1185.

Daily Technical Forecast

Based on the early price action and the upside momentum, the first target is a downtrending Gann angle at 1.1560. Look for sellers on the first test of this angle. Overtaking the angle will indicate the short-covering is getting stronger. This could trigger a further rally into the 50% level at 1.1298.

If the current intraday rally fails to advance over today’s intraday high at 1.1247 then look for a potential pullback into a short-term pivot at 1.1213.