EUR/USD Mid-Session Technical Analysis for March 12, 2014

Daily EUR/USD Technical Analysis

After two-days of consolidation, the EUR/USD is trading higher. Not only did today’s rally overcome a major long-term Fibonacci level at 1.3833, but it also regained the previous top at 1.3893. This is a sign of fresh buying. The first rally through this level last week may have been triggered by short-covering since the market sold off shortly after the breakout.

Holding above the Fib level at 1.3833 will put the market in a position to rally further. Traders should watch this level to gauge the strength of the buying.

If upside momentum continues today then look for traders to challenge last week’s top at 1.3914 into the close.  

Hourly EUR/USD Technical Analysis

Prior to today’s rally, the EUR/USD had been trading on the weak side of a retracement zone on the hourly chart at 1.3883 to 1.3890. This zone was created by the 1.3914 to 1.3833 range. Now that the retracement zone has been taken out with conviction, traders have to treat it as new support.

Besides this retracement zone, an uptrending angle from the 1.3843 bottom should also be considered support. This angle is at 1.3888 this hour and is moving up .0005 per hour. Holding this angle will mean momentum is increasing. This will be a strong sign that 1.3914 will be taken out at the close or shortly after Thursday’s opening.