EUR/USD Mid-Session Technical Analysis for November 16, 2018

The Euro is trading nearly flat after giving up earlier gains. The single-currency was supported early after reports out of Italy said that Italian Prime Minister Giuseppe Conte was looking to work with the EU over his government’s 2019 budget, which was rejected by Brussels earlier in the week. Concerns over weakening economic momentum in Europe, lingering issues over the budgetary conflict between the Italian government and the European Union, and Brexit uncertainty seem to have put a cap on the earlier rally.

At 1229 GMT, the EUR/USD is trading 1.1325, down 0.0011 or -0.09%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1216 will signal a resumption of the downtrend. A move through 1.1501 will change the main trend to up.

The main range is 1.1501 to 1.1216. Its retracement zone at 1.1359 to 1.1392 is resistance. This zone was successfully tested earlier today when the buying stopped at 1.1369.

The short-term range is 1.1216 to 1.1369. If the selling pressure continues then its retracement zone at 1.1293 to 1.1274 will become the next downside target. Aggressive counter-trend buyers could come in on a test of this zone. They will be trying to form a secondary higher bottom.

Daily Technical Forecast

Based on the early price action, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to a resistance cluster at 1.1359 to 1.1361. This area essentially stopped the earlier rally.

A sustained move under 1.1359 will indicate the presence of sellers. If the downside momentum continues then look for the selling to possibly extend into the uptrending Gann angle at 1.1296, followed closely by the short-term retracement zone at 1.1293 to 1.1274.

On the upside, taking out and sustaining a really over the downtrending Gann angle at 1.1361 will signal the return of buyers. If this generates enough upside momentum, we could see a rally into the main Fibonacci level at 1.1392. This is a potential trigger point for an acceleration into the downtrending Gann angle at 1.1431.

Basically, the EUR/USD is trading between a pair of price clusters. On the downside, the support cluster comes in at 1.1296 to 1.1293. On the upside, the resistance cluster comes in at 1.1361 to 1.1369.