EUR/USD Bouncing Back After Doji Signaled Shift In Sentiment
- EUR/USD Technical Strategy: Longs Preferred
- Dojisignaled hesitation by the bears near critical support
- Sellers likely to re-emerge at the 1.3700 handle
EUR/USD is powering higher after a Doji on the daily near key support at 1.3590 signaled a potential shift in sentiment amongst traders. With a strong up session underway, the close of the candle would yield a more noteworthy signal of a reversal in the form of a Morning Star pattern. Sellers are likely to re-emerge at the psychologically-significant 1.3700 handle.
Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
Drilling down to the four hour chart an Inverted Hammer formation offered an early indication of a recovery for EUR/USD. While there remain an absence of bearish patterns, new longs may be better served on a break of 1.3638 given the proximity to the level.
EUR/USD: Inverted Hammer Hinted At Intraday Recovery
4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here
By David de Ferranti, Market Analyst, DailyFX
Follow David on Twitter: @Davidde
To receive David’s analysis directly via email, please sign up here.
Learn how to read candlesticks to help identify trading opportunities with the DailyFX Candlesticks Video Course.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.