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EUR/USD Mid-Session Technical Analysis for March 24, 2020

By:
James Hyerczyk
Published: Mar 24, 2020, 13:04 UTC

Based on the early price action and the current price at 1.0823, the direction of the EUR/USD the rest of the session on Tuesday is likely to be determined by trader reaction to the steep uptrending Gann angle at 1.0616.

EUR/USD Mid-Session Technical Analysis for March 24, 2020

The Euro is trading higher against the U.S. Dollar on Tuesday as investors put more emphasis on the unprecedented Federal Reserve activity from Monday than the news that Euro Zone business activity crumbled in March in response to the coronavirus pandemic. The move makes sense since the Fed news is forward-thinking and the Euro Zone economic data is old news.

At 12:42 GMT, the EUR/USD is trading 1.0823, up 0.0096 or +0.90%.

The U.S. Dollar is under pressure for a second consecutive session on Tuesday after the U.S. Federal Reserve unveiled fresh measures to supply precious liquidity into funding markets.

In Europe, “Business activity across the Euro Zone collapsed in March to an extent far exceeding that seen even at the height of the global financial crisis,” said Chris Williamson, chief business economist at IHS Markit.

HIS Markit’s Euro Zone Composite Flash Purchasing Managers’ Index (PMI), seen as a good gauge of economic health, plummeted to a record low of 31.4 this month from February’s 51.6, by far its biggest one-month fall since the survey began in mid-1998. That reading was below all forecasts in a Reuters poll which had a median prediction of 38.8.

“Steep downturns were seen in France, Germany and across the rest of the Euro Zone as governments took increasingly tough measures to contain the spread of the coronavirus,” Williamson added.

Daily EUR/USD

Daily Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher following Monday’s closing price reversal bottom and today’s subsequent confirmation.

A trade through 1.0636 will negate the reversal bottom and signal a resumption of the downtrend.

The main trend will change to up on a move through 1.1496. This is highly unlikely, but there is room for a normal 50% to 61.8% correction.

The short-term range is 1.1496 to 1.0636. Its retracement zone at 1.1066 to 1.1167 is the primary upside target.

Daily Technical Forecast

Based on the early price action and the current price at 1.0823, the direction of the EUR/USD the rest of the session on Tuesday is likely to be determined by trader reaction to the steep uptrending Gann angle at 1.0616.

Bullish Scenario

Holding above 1.0616 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to possibly extend into a downtrending Gann angle at 1.1056, followed by a short-term 50% level at 1.1066.

Bearish Scenario

A failure to hold 1.0616 will be a sign of weakness. This could lead to a quick test of a pair of uptrending Gann angles at 1.0716 and 1.0676. The latter is the last potential support angle before the 1.0636 main bottom.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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