Yahoo Finance EUR/USD Forex Technical Analysis – Straddling Weak Side of Short-term Retracement Zone
The Euro is trading lower against the U.S. Dollar late Thursday as better-than-expected U.S. retail sales data on Thursday eased fears that the U.S. economy could be headed for a recession despite what a widely-watched Treasury yield indicator is flashing. Data released earlier in the session showed retail sales surged in July as consumers bought a range of goods even as they cut back on motor vehicle purchases.
At 19:24 GMT, the EUR/USD is trading 1.1106, down 0.0032 or -0.29%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through 1.1027 will signal a resumption of the downtrend. The main trend will change to up on a move through 1.1250.
The short-term range is 1.1027 to 1.1250. The EUR/USD is trading on the weak side of its retracement zone at 1.1112 to 1.1139. This zone is new resistance.
The next resistance is a long-term Fibonacci level at 1.1185, followed by the main retracement zone at 1.1220 to 1.1265.
Daily Technical Forecast
Based on Thursday’s price action and the current price at 1.1106, the direction of the EUR/USD into the close is likely to be determined by trader reaction to the short-term Fibonacci level at 1.1112.
Bearish Scenario
A sustained move under 1.1112 will indicate the presence of sellers. If this move is able to generate late session selling pressure then look for the move to possibly extend into the next uptrending Gann angle at 1.1077. This is followed by the next uptrending Gann angle at 1.1052. This is the last potential support angle before the 1.1027 main bottom.
Bullish Scenario
Overcoming and sustaining a rally over 1.1112 late in the session will signal the return of sellers. The first target is the uptrending Gann angle at 1.1127, followed closely by the short-term 50% level at 1.1139. This is a potential trigger point for an acceleration to the upside with the next major target a potential resistance cluster at 1.1185 to 1.1187.
This article was originally posted on FX Empire
