EUR/USD Mid-Session Technical Analysis for October 29, 2014

Daily EUR/USD Technical Analysis

The EUR/USD is trading in a tight and narrow range, shortly before the U.S. Federal Reserve Monetary Policy announcement at 2:00 pm EDT.

The main range is 1.2500 to 1.2886. The pivot created by this range is 1.2693. The short-term range is 1.2886 to 1.2613. Its pivot is 1.2750. Today’s price action is currently trading inside the 1.2693 to 1.2750 range. Trader reaction to this zone will likely set the tone for the day. Look for a bullish tone to develop over 1.2750 and a bearish tone under 1.2693.

The nearest uptrending angle today is at 1.2680. A break through this price could trigger an acceleration down to the main bottom at 1.2613. A trade through this price will turn the main trend to down on the daily chart and likely generate enough downside momentum to challenge another angle at 1.2590. This is the last angle before the 1.2500 main bottom.

The daily chart indicates there is plenty of room to the upside if 1.2750 is taken out with conviction. The main target is an uptrending angle at 1.2852.

The EUR/USD could turn extremely bullish if buyers can overcome 1.2860. This could fuel a move into the main 50% level at 1.2966.

Stay out of the market if it trades between 1.2693 and 1.2750, but be prepared for volatility if these levels are taken out with conviction.

Hourly EUR/USD Technical Analysis

The main trend is down on the hourly chart. A trade through 1.2747 will turn the main trend to up. A move through 1.2723 will reaffirm the downtrend.

The main range is 1.2839 to 1.2613. Its retracement zone at 1.2726 to 1.2753 is currently being tested. Look for a bullish tone later in the session if 1.2726 is taken out with conviction and a bearish tone under 1.2753.

The intermediate range is 1.2613 to 1.2764. Its retracement zone is 1.2689 to 1.2671. This is one key downside target.

The short-term range is 1.2665 to 1.2764. Its retracement zone at 1.2715 to 1.2703 is another downside target.

With retracement zones layers at 1.2726, 1.2715, 1.2703, 1.2689 and 1.2671, traders should look for a possible two-sided trade until the release of the Fed statement.

A dovish statement should lead to a breakout over 1.2753. A hawkish tone should lead to a breakdown under 1.2726. Look for increased volatility, following the release of the Fed statement at 2:00 pm EDT.