EUR/USD Mid-Session Technical Analysis for October 19, 2018
The Euro is rebounding after earlier weakness was fueled by fresh concerns about political tensions in the common currency zone. Tensions could be easing which is helping to spark a short-covering rally. The inability to take out the October 9 bottom at 1.1432 may have also encouraged investors to take profits after this week’s steep decline.
At 1143 GMT, the EUR/USD is trading 1.1469, up 0.0018 or +0.16%.
Daily Technical Analysis
The main trend is down according to the daily swing chart. A trade through 1.1432 will reaffirm the downtrend. A move through 1.1622 will change the trend to up.
The main range is 1.1301 to 1.1816. Its retracement zone at 1.1498 to 1.1559 is resistance. Trading below this zone is also helping to contribute to the downside bias.
The short-term range is 1.1622 to 1.1433. Its retracement zone at 1.1527 to 1.1550 is trading inside the main retracement zone. It is a potential upside target and resistance area.
Daily Technical Forecast
Based on the early price action, the direction of the EUR/USD is likely to be determined by trader reaction to the main bottom at 1.1432.
Holding above 1.1432 will indicate the presence of counter-trend buyers. If this can generate enough upside momentum then look for a rally into the resistance cluster at 1.1498 to 1.1502.
Since the main trend is down, look for sellers on the initial test of the resistance cluster. Overcoming 1.1502 will indicate the buying is getting stronger with 1.1527 the next likely upside target.
A failure to hold 1.1432 will signal the return of sellers. This could trigger the start of a steep break since the next major downside target doesn’t come in until 1.1301.
This article was originally posted on FX Empire
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