EUR/USD ECB Setup- Outlook Remains Constructive Above 1.1140
- EURUSD at near-term resistance ahead of ECB
- Updated targets & invalidation levels
Chart Created Using TradingView
Technical Outlook: Euro rallied into a key near-term resistance confluence in New York today at 1.1269/73. This region is defined by the 100% extension of the advance off last week’s low, the 61.8% retracement of the decline off the August high and the upper parallel extending off last week’s high. We highlighted this region last night on SB Trade Desk and while our broader focus remains higher in the pair, we’re on the lookout for a pullback to offer more favorable long-entries.
Interim support rests at 1.1229/31 backed by 1.1197 where the 50% retracement converges on a basic median-line parallel- are of interest for exhaustion / long-entries. A break below the weekly opening range lows at 1.1139 would be needed to shift the broader focus back to the downside.
A breach of the highs targets trendline resistance extending off the August high backed by 1.1314/18. More significant resistance is eyed at the 61.8% retracement of the decline off the 2016 high at 1.1347.For the complete setup and to continue tracking this trade & more throughout the week- Subscribe to SB Trade Desk.
Avoid the pitfalls of near-term trading strategies by steering clear of classic mistakes. Review these principles in the "Traits of SuccessfulTraders” series.
- A summary of the DailyFX Speculative Sentiment Index (SSI) shows traders are net ShortEURUSD- the ratio stands at -1.70 (37% of traders are long)- bullish reading
- Yesterday the ratio was at -1.22. Long positions are 19.9% below levels seen last week while Short positions jumped 12.8% during the same time period.
- Open interest is 1.7% higher than yesterday and 5.3% above its monthly average.
- Increasing long exposure on building open interest keeps the focus higher & heading into the ECB interest rate decision we’ll be looking for a pullback to offer favorable long opportunities while above 1.1197.
Help fine-tune you entries, click here to learn more about the DailyFX Grid Sight Index (GSI)
Relevant Data Releases This Week
Other Setups in Play:
- USDJPY: NFP Game-plan Same as Jackson Hole- Buy the Washout
- AUDUSD Searches for Support as NFPs Take Center Stage
- USDCAD Rally to Face Canada GDP- Support at 1.2965
- GBPJPY at Key Resistance Hurdle Ahead of UK Mortgages- 133.14 Support
Looking for more trade ideas? Review DailyFX’s Top Trading Opportunity of 2016
---Written by Michael Boutros, Currency Strategist with DailyFX
Join Michael for Live Scalping Webinars on Mondays on DailyFX and Tuesday, Wednesday & Thursday’s on SB Trade Desk at 12:30 GMT (8:30ET)
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.