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Long EUR/USD at Market Ahead of FOMC, NFP

Long EUR/USD at Market Ahead of FOMC, NFP

James Stanley, Senior Strategist

Talking Points:

- EUR/USD remains bullish after seeing prices pullback since last Thursday’s breakout.

- IG Client Sentiment remains stretched in EUR/USD at -2.53-to-1. This is bullish given retail sentiment’s contrarian nature.

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This setup is attached to the previous long EUR/USD Analyst Pick from last week. I had hedged around the Dollar ahead of last week’s Central Bank speeches, and EUR/USD remains bullish with the prospect of further topside continuation. With half of the position exited out and one target remaining at 1.1500, the door is opened for re-entry.

We looked at this setup earlier this morning as USD,DXY is working with short-term resistance. Current support in EUR/USD is showing at the 38.2% Fibonacci retracement of the most recent bullish move, and just below at the 50% retracement, we have confluence as this lines up with the prior resistance around 1.1285. Stops will be set below the 61.8% retracement in the event that a test of the 50% level is in the cards as we’re nearing two rather pivotal pieces of US data.

Stops below 1.1230

Break-even stop move at 114.40

First target: 1.1480

Target 2: 1.1615

Long EUR/USD at Market Ahead of FOMC, NFP

Chart prepared by James Stanley

--- Written by James Stanley, Strategist for DailyFX.com

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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