EUR/USD Mid-Session Technical Analysis for February 26, 2015

Daily EUR/USD Technical Analysis

The EUR/USD is posting an inside day at the mid-session. The market is trading slightly better, but volume and volatility are extremely low. Traders are likely waiting for the latest U.S. inflation data at 8:30 a.m. ET before making their play today.

The market is currently trading inside an uptrending channel. The lower level of the channel is 1.1327. The upper level is 1.1399.

A breakdown under 1.1327 could lead to a further decline into a retracement zone at 1.1315 to 1.1264. A trade through 1.1278 then 1.1269 will reaffirm the downtrend.

On the upside, the first major target is a potential resistance cluster at 1.1399 to 1.1401. There may be selling on the initial test of this area, but it is also a potential trigger point for a strong upside breakout with the next targets 1.1432 and 1.1449. A trade through 1.1449 will turn the main trend to up on the daily chart.

Look for volatility and volume to re-emerge after the release of the U.S. economic data.

Hourly EUR/USD Technical Analysis

The main trend is up on the hourly chart. The market is currently trading inside a retracement zone at 1.1362 to 1.1377. Trader reaction to this zone is likely to set the tone for the day.

A sustained move over 1.1377 will set a bullish tone and could trigger a challenge of 1.1388. The market could accelerate to the upside if this price is taken out with conviction.

A failure to hold 1.1362 could trigger an acceleration to the downside with 1.1338 the next target. A trade through 1.1335 will turn the main trend to down on the hourly chart with 1.1326 the next target.

A failure at 1.1326 could trigger an even harder break with 1.1288 another potential target.