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EUR/USD Mid-Session Technical Analysis for February 23, 2017

By:
James Hyerczyk
Published: Feb 23, 2017, 12:04 UTC

The EUR/USD is trading slightly lower at the mid-session following Wednesday’s potentially bullish closing price reversal bottom. The chart pattern hasn’t

EUR/USD

The EUR/USD is trading slightly lower at the mid-session following Wednesday’s potentially bullish closing price reversal bottom. The chart pattern hasn’t been confirmed, however. The current inside move indicates investor indecision and impending volatility.

Fundamentally, investors seem to be digesting the Fed minutes released on Wednesday. The Fed said in the minutes that it could raise interest rates “fairly soon”, but the price action in the U.S. Dollar and other financial markets suggests that investors think otherwise.

The rally in the EUR/USD on Wednesday was fueled more by a weaker U.S. Dollar than a stronger Euro.

Euro investors are still expressing concerns over the French elections, particularly the growing popularity of far-right candidate Marine Le Pen.

EURUSD
Daily EUR/USD

Technical Analysis

The main trend is down according to the daily swing chart. However, Wednesday’s closing price reversal bottom suggests that momentum may be getting ready to shift to the upside.

A trade through 1.0573 will confirm the chart pattern. This could trigger a 2 to 3 day rally into 1.0660 to 1.0700.

The main range is 1.0339 to 1.0828. Its retracement zone is 1.0583 to 1.0526. The market is currently trading inside this zone. Trader reaction to this zone will determine the near-term direction of the EUR/USD. Another key 50% level comes in at 1.0606.

The short-term range is 1.0828 to 1.0493. Its retracement zone at 1.0660 to 1.0700 is the primary upside target.

Forecast

The EUR/USD is currently trading at 1.0554. Its nearest downside target is a support cluster at 1.0526 to 1.0524. This is the support. If it fails to hold then look for a test of 1.0493.

Taking out 1.0493 will negate the closing price reversal bottom and likely trigger an acceleration to the downside with the next target angle coming in at 1.0432. This is the last major support angle before the 1.0339 main bottom.

The first upside target is the 50% level at 1.0583. This is followed by another 50% level at 1.0606. This price is the trigger point for an acceleration into the short-term 50% level at 1.0660.

We could sit inside 1.0583 to 1.0526 today until traders decide which way they want to take the EUR/USD.

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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