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EUR/USD Technical Analysis: Looking for Direction Below 1.13

EUR/USD Technical Analysis: Looking for Direction Below 1.13

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Talking Points:

  • EUR/USD Technical Strategy: Flat
  • Euro locked in wide range below 6-month high vs. US Dollar
  • Setup inconclusive despite fading relative strength readings

The Euro has stalled after rising to the highest level in six months against the US Dollar, will prices oscillating in a wide range below the 1.13 figure. Fading relative strength studies point to ebbing upside momentum, but that is no sure sign of on-coming reversal and may only reflect consolidation.

Range top resistance is marked by the 23.6% Fibonacci expansion at 1.1272, with a break above that on a daily closing basis opening the door for a test of the 38.2% level at 1.1374. Alternatively, a reversal back below the 14.6% expansion at 1.1209 exposes the 23.6% Fib retracement at 1.1104.

Current positioning does not seem to offer an attractive trading opportunity. Prices are too close to resistance to make a long bet attractive from a risk/reward perspective. On the other hand, the absence of a clear-cut bearish reversal signal warns that taking the short side is premature. Staying flat seems best for now.

Retail traders expect the Euro to fall. Find out here what this hints about the coming price trend!

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.