EUR/USD Mid-Session Technical Analysis for November 18, 2021

The Euro is trading higher on Thursday as the U.S. Dollar took a breather after testing a 16-month low the previous session. Uncertainty over the pace of Federal Reserve tapering and the timing of its first post-pandemic interest rate hike may be driving the short-covering rally.

At 11:59 GMT, the EUR/USD is trading 1.1345, up 0.0022 or +0.20%.

Helping to underpin the common currency is a drop in U.S. Treasury yields. Yields started to fall on Wednesday following a slip in the number of housing starts in October. They could get propped up later in the session when the U.S. releases a report on weekly unemployment claims.

The number of jobless claims filed during the week ended November 13 is due to be released at 13:30 GMT. Economists polled by Dow Jones are expecting initial filings for unemployment insurance fell to 260,000 last week, from the previous week’s 267,000 claims.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher following the confirmation of yesterday’s closing price reversal bottom earlier in the session.

A trade through 1.1264 will negate the closing price reversal bottom and signal a resumption of the downtrend. A move through 1.1608 will change the main trend to up.

The minor trend is also down. A trade through 1.1464 will change the minor trend to up. This will confirm the shift in momentum.

The minor range is 1.1464 to 1.1264. Its 50% level at 1.1364 is the first upside target.

The second minor range is 1.1608 to 1.1264. Its pivot at 1.1436 is another potential upside target.

On the downside, support is a long-term Fibonacci level at 1.1291, followed by a series of main bottoms at 1.1255, 1.1219 and 1.1168.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD into the close on Thursday is likely to be determined by trader reaction to 1.1364.

Bearish Scenario

A sustained move under 1.1364 will indicate the presence of sellers. The first downside target is 1.1306, followed by 1.1291 and the new minor bottom at 1.1264.

Taking out 1.1264 will reaffirm the downtrend. The first target is the July 10, 2020 main bottom at 1.1255. If this fails, the rally could extend into other main bottoms at 1.1219 and 1.1168.

Bullish Scenario

A sustained move over 1.1364 will signal the presence of buyers. This could trigger an acceleration to the upside if the volume is strong enough with 1.1436 the next target.