EUR/USD Threatening Break of Key Gann Threshold
- EUR/USD at key near-term price point
- Late December one of the more positive seasonal periods of the year for the euro
Unfamiliar with Gann Square Root Relationships? Learn more about them HERE.
The 1x2 Gann angle line drawn from the year’s high has proven to be remarkable resistance over the past couple of months in EUR/USD as every recovery attempt during this time has failed somewhere around it. On Thursday after a brief foray above this level the euro turned down and failed once again to register a daily close above the key Gann threshold. This morning we find spot prices right back at resistance and again threatening a break. We think a close over this level would be a significant change in behavior and warn that this correction in the euro has a bit and perhaps even a lot more to run. Such a move would fit well with the clear seasonal tendency for the euro to rally into year end and further confirm the momentum divergences that have been building over the past few weeks.
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EUR.USD Chart: December 12, 2014
Charts Created using Marketscope – Prepared by Kristian Kerr
Key Event Risk in the Week Ahead:
LEVELS TO WATCH
Resistance: 1.2470 (Gann), 1.2580(Gann)
Support: 1.2355 (Gann), 1.2325 (Fibonacci)
Strategy: Buy EUR/USD
Entry: Look to buy on weakness into Tuesday if we get a close over 1.2440
Stop: Daily close under 1.2355
--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
To contact Kristian, e-mail firstname.lastname@example.org. Follow me on Twitter at@KKerrFX.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.