Forex technical analysis: EUR/USD trades near days midpoint
Tested support at MA level. Rallied modestly higher.
The EUR/USD fell in Asian Pacific trading and approached the 100 bar MA on the 4-hour chart, The price pushed through that level on employment Friday earlier this month and took off. Today, traders put their trust against the level and the pair held and rallied (the MA came in at 1.1229, while the low stalled at 1.1233).
The rally took the price up to a high of 1.1277. The price has since moved lower and trades at 1.1253. The midpoint of the day is 1.12544. The midpoint of the move up from the May 30th low is 1.1256.
The pair is gathering more momentum to the downside as I type (relatively that is) and is now negative on the day.
Looking at the daily chart, we know from last week that the EUR/USD stalled just ahead of the 61.8% of the move down from the May high to the May low. The fall from that peak as the 100 day MA at the 1.1211 level to shoot for. That also corresponds with the low from April 25th at the 1.12137. Should the selling get below the 100 bar MA on the 4-hour, that 100 day MA area should provide decent support on test.
The day activity is more bearish on the move lower and the fall below the 50% at 1.1254, but support at the 1.1230 level looms. It is a traders market. Which means the momentum could swing the other way . I would watch 1.1254 perhaps up to 1.1262 now. That is where the 200 and 100 bar MAs on the 5-minute chart is found (RISK level for shorts now)..
Just when you think you have seen it all….
If you have not been warned enough – or thought you have seen it all – you get what we just got.
There is no need to rehash what happened, but let’s just repeat…
There are 3 types of risk.
As mentioned earlier, event risk occurs at scheduled times but can also occur at unscheduled times – like in the example of a poll. There can also be rumors too that cause unexpected swings. What I forgot to include was that event risk can be unscheduled, AND then reported backwards. Geez..
We have now entered a phase where traders will suck themselves into a hole, cover themselves up and hibernate. They will leave for the sidelines and stay away. That may actually cause the market to NOT move.
Plenty of traders got burned to the upside and to the downside. They all collectively will now put up the middle finger, take their ball and go home.
So what do you want to talk about now?