The Euro is trading higher on Friday, rebounding from earlier weakness as buyers came in to defend the March 7 main bottom. Due to the prolonged move down in terms of price and time, the currency begins the session inside the window of time for a potentially bullish closing price reversal bottom. Today’s early price action suggests the single-currency may be forming this chart pattern.
At 14:59 GMT, the EUR/USD is trading 1.1235, up 0.0011 or +0.10%.
Daily Technical Analysis
The main trend is up, but momentum is trending lower. A trade through 1.1177 will change the main trend to down. Today’s lower-low, higher-close indicates Forex pair traders may be attempting to form a closing price reversal bottom. If formed and confirmed, we could see a 2 to 3 day rally.
The main range is 1.1177 to 1.1448. Its retracement zone at 1.1281 to 1.1313 is the primary upside target. This zone is controlling the near-term direction of the EUR/USD.
On the downside, the nearest retracement level support is a Fibonacci level at 1.1185. This is followed by a main bottom at 1.1177 and the June 20, 2017 main bottom at 1.1118.
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 the uptrending Gann angle at 1.1217.
Bullish Scenario
A sustained move over 1.1217 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the next uptrending Gann angle at 1.1257. Overcoming this angle will indicate the buying is getting stronger. This could trigger a further rally into the Fibonacci level at 1.1281.
Bearish Scenario
A sustained move under 1.1217 will signal the presence of sellers. This could trigger an extension of the weakness into 1.1185, followed closely by 1.1177. This is a potential trigger point for a break into a downtrending Gann angle at 1.1168. Crossing to the weak side of this angle will indicate the selling is getting stronger with 1.1118 the next downside target.