EUR/USD Mid-Session Technical Analysis for July 17, 2017

The EUR/USD is drifting lower today shortly before the U.S. opening. The price action suggests light volume ahead of this week’s European Central Bank interest rate decision and ECB President Mario Draghi’s press conference.

Earlier today, Euro Zone Final CPI came in unchanged and as forecast at 1.3%. Final Core CPI came in at 1.1%, meeting expectations and equaling the previous reading.

Traders also seem to be optimistic ahead of the second round of formal Brexit talks in Brussels.

Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has slowed since the formation of the closing price reversal top at 1.1489 on July 12.

A trade through 1.1489 will negate the closing price reversal top and signal a resumption of the uptrend. This could put the Euro on a path towards the May 3, 2016 main top at 1.1616.

A trade through 1.1369 will turn the minor trend to down. A move through 1.1312 will change the main trend to down.

The short-term range is 1.1312 to 1.1489. Its retracement zone at 1.1401 to 1.1380 is support.

The main range is 1.1118 to 1.1489. Its retracement zone at 1.1304 to 1.1260 is the primary downside target.

Forecast

Based on the current price at 1.1456 and the earlier price action, the first upside objective is the short-term uptrending angle at 1.1472. Crossing to the strong side of this angle will mean the buying is getting stronger. This could lead to a breakout over 1.1489 and a test of the longer-term angle at 1.1498. Crossing to the strong side of the angle at 1.1498 will put the Euro in a bullish position.

A failure to overcome 1.1472 will signal the presence of sellers. The daily chart is open to the downside with the next objectives 1.1401, 1.1392 and 1.1380.

Watch the price action and read the order flow at 1.1472. Trader reaction to this angle will tell us if the buying is getting stronger or if sellers are retaking control.