EUR/USD Bullish Above 11450
Check out the intermediate-term fundamental and technical outlook in the Q1 EURO Forecast.
EUR/USD volatility set to expand as breakout unfolds
The other day I discussed the pent-up pressure in long-term Euro volatility and how coupled with short-term volatility conditions it creates an explosive situation. Running with yesterday’s breakout into the mid-11500s we should see EUR/USD continue to make good on higher prices in the near-term and maybe longer.
Looking to resistance levels, the 200-day is rolling down to around 11636 at this time, but with it not having any confluence with major price levels it’s not viewed as ultra-significant. The next major area of price resistance doesn’t arrive until the 11800/50 area, leaving a solid 250/300 points from current levels.
This may indeed turn to be a false breakout, but we’ll take what is in front of us and run with a bullish trading bias as long as we don’t see a breakdown back inside the range. If price trades back to 11450, then more choppiness or a full reversal and gathering of momentum may take shape to the downside as the market is caught leaning the wrong way. An outcome we’ll discuss later should it become relevant.
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EUR/USD Daily Chart (Bullish above 11450/resistance ~11800)
***Updates will be provided on these ideas and others in the trading/technical outlook webinars held on Tuesday and Friday. If you are looking for ideas and feedback on how to improve your overall approach to trading, join me on Thursday’s for the Becoming a Better Trader webinar series.
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.