EUR/USD Mid-Session Technical Analysis for August 22, 2017

The EUR/USD is trading lower shortly before the U.S. opening. The Euro is reversing yesterday’s rally while holding inside its range. This indicates investor indecision and impending volatility.

Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1847 will turn the main trend to up. The next upside target is 1.1910.

A trade through 1.1661 will signal a resumption of the downtrend.

The main retracement zone and primary downside target is 1.1611 to 1.1540.

The intermediate retracement zone is 1.1786 to 1.1815. This zone provided resistance on Monday and earlier today.

The short-term range is 1.1661 to 1.1828. Its retracement zone at 1.1745 to 1.1725 was tested earlier in the session. Aggressive counter-trend buyers are going to buy a test of this zone in an effort to form a secondary higher bottom. Trend traders are going to try to drive the market through this zone in an effort to make 1.1828 a new main top.

Forecast

Based on the current price at 1.1752 and the earlier price action, the direction of the EUR/USD the rest of the session will be determined by trader reaction to the short-term 50% level at 1.1745.

Holding 1.1745 will indicate the presence of buyers. This could drive the market into a pair of downtrending angles at 1.1770 and 1.1777. Overcoming 1.1777 could lead to a test of the retracement zone at 1.1786 to 1.1815. This is followed closely by a downtrending angle at 1.1840.

Crossing to the weak side of the 50% level at 1.1745 could lead to a test of a support cluster at 1.1725 to 1.1721. This is the trigger point for an acceleration into an uptrending angle at 1.1691. This is the last potential support angle before the 1.1661 main bottom and the major uptrending angle at 1.1653.

The chart indicates a range bound trade with support and resistance spread equally. The key number today is also a short-term 50% level which is essentially the definition of range bound.