Talking Points
EURUSD 60min
Chart Created Using TradingView
Technical Outlook: Earlier in the week we highlighted a key Fibonacci confluence at 1.1228/31 with the Euro reversing off that mark before breaking below the weekly opening range lows. The pair continues to hold within the confines of a well-defined ascending pitchfork formation with a couple of near-term parallels highlighting interim support around 1.1119.
Heading into tomorrow’s highly anticipated U.S. Non-Farm Payroll report, the immediate risk remains lower while below the weekly / monthly open at 1.1170 with a break of interim support targeting 1.1093 & 1.1060 - both areas of interest for possible exhaustion / long-entries.
From a trading standpoint, I would be looking fade euro weakness into structural supportwith topside resistance objectives unchanged at 1.1228/31 backed by a more significant median-line confluence around 1.1273 (key). For the complete setup and to continue tracking this trade& more throughout the week- Subscribe to SB Trade Deskand take advantage of the DailyFX New Subscriber Discount.
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- A summary of the DailyFX Speculative Sentiment Index (SSI) shows traders are net short EURUSD- the ratio stands at -1.45(41% of traders are long)-bullishreading
- Short positions are 13.5% lower than yesterday and 5.1% above levels seen last week.
- Open interest is 5.5% lower than yesterday and 5.8% above its monthly average.
- Although retail positioning remains net short, the recent pullback in short exposure suggests the pair may be vulnerable to a near-term pullback before continuing higher. That said, heading into tomorrow’s NFP release, I’d be looking for a build in short exposure on a move lower to offer more favorable long entries.
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Relevant Data Releases This Week
Other Setups in Play:
- GBP/USD Rally to Face BoE- Outlook Remains Constructive Above 1.3160
- GBP/JPY Bound to Support Before BoE
- EUR/USD: Looking for Opportunities to Buy Dips Heading Into U.S. ISM
- EUR/JPY Into the Gauntlet- Chasm of Support Awaits
- AUDUSD Vulnerable to RBA - Technicals Remains Constructive Above 7495
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---Written by Michael Boutros, Currency Strategist with DailyFX
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