EUR/USD Mid-Session Technical Analysis for October 29, 2018

The Euro is trading nearly flat on Monday. The Forex pair is trading inside Friday’s range which suggests investor indecision and impending volatility. On Friday, the Euro posted a potentially bullish closing price reversal bottom. A trade through 1.1422 will confirm the chart pattern. This won’t change the trend to up, but it will indicate the buying is greater than the selling at current price levels. It could also fuel the start of a 2 to 3 day counter-trend rally.

At 1245 GMT, the EUR/USD settled at 1.1414, up 0.0023 or +0.20%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1422 will confirm the reversal bottom. This will shift momentum to the upside. A trade through 1.1555 will change the main trend to up.

A move through 1.1335 will negate the closing price reversal bottom and signal a resumption of the downtrend with the August 15 main bottom at 1.1301 the next likely downside target.

The short-term range is 1.1555 to 1.1335. Its retracement zone at 1.1445 to 1.1471 is the first upside target. Since the main trend is down, sellers are likely to come in on a test of this zone.

The major retracement zone comes in at 1.1498 to 1.1559. This zone is resistance.

Daily Technical Forecast

Based on the early trade, the direction of the EUR/USD on Monday is likely to be determined by trader reaction to 1.1422.

Bullish Scenario

Taking out 1.1422 will signal the presence of buyers. This will also confirm the reversal bottom. This could drive the EUR/USD into a series of levels, a downtrending Gann angle at 1.1442, a 50% level at 1.1445 and another downtrending Gann angle at 1.1455. Since the main trend is down, we could see selling on the first test of any of these levels.

Overtaking 1.1455 will indicate the buying is getting stronger with the next target the short-term Fibonacci level at 1.1471.

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Bearish Scenario

The inability to takeout or sustain a rally over 1.1422 will signal the presence of sellers. This could trigger a break into a downtrending Gann angle at 1.1355. Crossing to the weak side of this angle will put the EUR/USD in a bearish position. This could lead to a test of 1.1335.

A failure at 1.1335 will indicate the selling is getting stronger with 1.1301 the next likely downside target.