EUR/USD: Tech report for the week - confluence around 1.08
Weekly gain/loss: + 94 pips
Weekly closing price: 1.0784
In spite of the prior week’s palpable selling wick, last week’s movement chalked up a nice-looking weekly bullish engulfing candle, which, as you can see, forced the pair to cross swords with a weekly resistance level coming in at 1.0819. This – coupled with the 2016 yearly opening level located just above it at 1.0873, could very well see buying fade this week.
On the other side of the coin, nonetheless, daily action recently bounced off daily support drawn from 1.0710 and shows room to extend north up to the daily resistance penciled in at 1.0850. While the weekly and daily timeframe structures are currently opposing one another, one thing to keep in mind here is that 1.0850 sits beautifully in between the aforementioned weekly resistance and 2016 yearly opening base. Therefore, at least in our opinion, this is a nearby zone to keep an eye on for shorting opportunities this week.
Friday’s US employment report published mixed figures. Non-farm employment change came in above expectations at 227k, whereas both the unemployment rate and average hourly earnings were less encouraging. The aftermath of the event initially sent the single currency to lows of 1.0709, clipping the top edge of a H4 demand base at 1.0684-1.0709, before reversing tracks and eventually clocking highs of 1.0797 on the day.
Our suggestions: Directly above current price on the H4 chart is a nice-looking area of resistance at 1.0819/1.08. Building a case for entry here we have the following structures in play (yellow zone): a psychological resistance barrier at 1.08, February’s opening level at 1.0801, a H4 Quasimodo resistance at 1.0812, a H4 trendline resistance extended from the high 1.0873 and finally we also have the weekly resistance mentioned above at 1.0819.
Although there is a possibility that price may fake through this H4 sell area to tap the daily resistance at 1.0850 and maybe even the 2016 yearly opening level at 1.0873, we still feel a short from the above noted H4 sell zone is something to consider. Whether you believe this area is stable enough to justify a trade without the need for additional confirmation is, of course, down to the individual trader. For us personally, we’re opting to wait for a reasonably sized H4 bearish candle to take shape before deciding if a trade from this zone is worthy of our capital. As of now, risk/reward from this region looks reasonably favorable given that the next downside target on the H4 scale comes in at the H4 demand mentioned above at 1.0684-1.0709.
Data points to consider: There are no scheduled high-impacting news events on the docket today relating to these two markets.
Weekly closing price: 1.0784
In spite of the prior week’s palpable selling wick, last week’s movement chalked up a nice-looking weekly bullish engulfing candle, which, as you can see, forced the pair to cross swords with a weekly resistance level coming in at 1.0819. This – coupled with the 2016 yearly opening level located just above it at 1.0873, could very well see buying fade this week.
On the other side of the coin, nonetheless, daily action recently bounced off daily support drawn from 1.0710 and shows room to extend north up to the daily resistance penciled in at 1.0850. While the weekly and daily timeframe structures are currently opposing one another, one thing to keep in mind here is that 1.0850 sits beautifully in between the aforementioned weekly resistance and 2016 yearly opening base. Therefore, at least in our opinion, this is a nearby zone to keep an eye on for shorting opportunities this week.
Friday’s US employment report published mixed figures. Non-farm employment change came in above expectations at 227k, whereas both the unemployment rate and average hourly earnings were less encouraging. The aftermath of the event initially sent the single currency to lows of 1.0709, clipping the top edge of a H4 demand base at 1.0684-1.0709, before reversing tracks and eventually clocking highs of 1.0797 on the day.
Our suggestions: Directly above current price on the H4 chart is a nice-looking area of resistance at 1.0819/1.08. Building a case for entry here we have the following structures in play (yellow zone): a psychological resistance barrier at 1.08, February’s opening level at 1.0801, a H4 Quasimodo resistance at 1.0812, a H4 trendline resistance extended from the high 1.0873 and finally we also have the weekly resistance mentioned above at 1.0819.
Although there is a possibility that price may fake through this H4 sell area to tap the daily resistance at 1.0850 and maybe even the 2016 yearly opening level at 1.0873, we still feel a short from the above noted H4 sell zone is something to consider. Whether you believe this area is stable enough to justify a trade without the need for additional confirmation is, of course, down to the individual trader. For us personally, we’re opting to wait for a reasonably sized H4 bearish candle to take shape before deciding if a trade from this zone is worthy of our capital. As of now, risk/reward from this region looks reasonably favorable given that the next downside target on the H4 scale comes in at the H4 demand mentioned above at 1.0684-1.0709.
Data points to consider: There are no scheduled high-impacting news events on the docket today relating to these two markets.
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