Near-term Setups in EURUSD & NZDUSD
EURUSD- The ECB interest rate decision is on tap tomorrow morning and as highlighted in today’s Scalp Report, the pair is trading within the confines of a near-term ascending slope formation off last week’s lows. The focus remains higher near-term while above 1.1197 with a break below the weekly low needed to invalidate the uptrend. Into the release, I’d be looking to fade weakness into / while above structural support.
Kiwi has made an initial test of a key resistance confluence at 7481-7515. This region is defined by the 161.8% extension of the advance off the 2015 low, the 50% retracement of the July 2014 decline and basic parallel resistance extending off the June high. The long-bias is at risk near-term while below this threshold and although I haven’t operated on this setup yet, I’ll be looking for short triggers in momentum on another attempt to push through this region. Interim support rests at 7380/91 backed by 7296 & 7218 (bullish invalidation).
A breach above this region targets subsequent targets at 7697 and a key resistance confluence at 7826. Keep in mind this is a longer-term outlook and until we get a close above this region- the risk is for a pullback in price near-term.
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---Written by Michael Boutros, Currency Strategist with DailyFX
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