EUR/USD: Breach of Weekly High to Fuel Reversal From Monthly Open
- EUR/USD Rebounds off critical support- constructive above 1.1128
- Updated targets & invalidation levels
Chart prepared by Michael Boutros
Broader Technical Outlook: Earlier this week I highlighted key support & bullish invalidation at 1.1129 where the June open converges on the slope support extending off the March 2nd low. The post FOMC sell-off has rebounded right off this mark and keeps the trade constructive while above this threshold. A breach / close above the weekly opening-range high / median-line (blue) is needed to validate the reversal higher with such a scenario targeting the 1.1418/43 zone.
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Notes: EURUSD is trading within the confines of a well-defined descending channel formation off the monthly high with the pair rebounding sharply today in U.S. trade off confluence channel support. I’ve closed out 3/4 of the long position here at near-term resistance at 1.1239/45 with stops now at breakeven. We’ve been tracking this trade on SB Trade Desk all month long and from here we’ll be looking for pullbacks to offer more favorable long entries while above 1.1128.
Topside objectives are eyed at 1.1272 with a breach above 1.1306 needed to keep the immediate long-bias in play. Subsequent resistance targets at 1.1347 and the October high-day reversal close at 1.1385. A quarter of the daily average true range (ATR) yields profit targets of 20-24 pips per scalp. The economic docket is rather light heading into the close of the week with market focus shifting to next week’s critical U.K. referendum. Continue tracking this setup and more throughout the week- Subscribe to SB Trade Desk and take advantage of the DailyFX New Subscriber Discount.
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Relevant Data Releases
Other Setups in Play:
- AUD/USD Post-FOMC Rebound Looks to AU Employment, US CPI for Fuel
- FOMC Game Plan - EUR/USD Constructive Above Monthly Open at 1.1128
- EUR/GBP Into Resistance Ahead of UK Jobs, BoE
- GBP/USD Levels to Know Ahead of UK CPI, FOMC & BoE
- Webinar: FOMC Setups - Markets Primed for Yellen
Looking for trade ideas? Review DailyFX’s 2016 2Q Projections
---Written by Michael Boutros, Currency Strategist with DailyFX
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.