Euro Technical Price Outlook: EUR/USD Near-term Trade Levels
- Euro updated technical trade levels – Daily & Intraday Charts
- EUR/USD rallies more than 2.1% off May low– bulls vulnerable into objective yearly open
- Key resistance / breakout level at 1.2239/61 - Support at 1.2168, bullish invalidation 1.2143
Euro rallied more than 0.6% against the US Dollar since the start of the week with a breakout of the May opening-range taking EUR/USD into a key technical resistance zone around the objective yearly open. While the broader focus remains constructive, the immediate advance may be vulnerable near-term and we’re looking for possible price inflection off this key zone. These are the updated targets and invalidation levels that matter on the EUR/USD technical price charts heading into the close of the week. Review my latest Strategy Webinar for an in-depth breakdown of this Euro technical setup and more.
Euro Price Chart – EUR/USD Daily
Chart Prepared by Michael Boutros, Technical Strategist; EUR/USD on Tradingview
Technical Outlook: EUR/USD set the May opening-range just below the median-line / February high-day close at 1.2168 with a topside breach on Tuesday fueling a rally into critical resistance at the objective yearly open / 61.8% extension at 1.2239/61- looking for inflection off this zone for guidance with the immediate rally vulnerable while below. The trade remains constructive while within the ascending March channel with a breach / close higher exposing the yearly high-day close / 88.6% Fibonacci retracement at 1.2323/36.
Euro Price Chart – EUR/USD 120min
Notes: A closer look at Euro price action shows EUR/USD trading within an embedded ascending pitchfork formation extending off the late-April / May lows with the weekly opening-range set just below key resistance. Initial support at 1.2168 backed by the weekly open at 1.2143- Look for a reaction there IF reached with a break below this formation needed to suggest a larger reversal is underway.
Bottom line: The Euro rally has extended into yearly open resistance and the advance may be vulnerable near-term while below 1.2239/61. From at trading standpoint, a good zone to reduce long-exposure / raise protective stops – be on the lookout for downside exhaustion ahead of the lower parallel IF price is indeed heading higher on this stretch. Review my latest Euro Weekly Price Outlook for an in-depth look at the longer-term EUR/USD technical trade levels.
For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy
Euro Trader Sentiment – EUR/USD Price Chart
- A summary of IG Client Sentiment shows traders are net-short EUR/USD - the ratio stands at -1.91 (34.35% of traders are long) – typically bullish reading
- Long positions are 20.92% higher than yesterday and 6.35% higher from last week
- Short positions are9.33% lower than yesterday and 7.92% higher from last week
- We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EUR/USD prices may continue to rise. Traders are less net-short than yesterday but more net-short from last week and the combination of current positioning and recent changes gives us a further mixed EUR/USD trading bias from a sentiment standpoint.
| Change in | Longs | Shorts | OI |
| Daily | 0% | 11% | 3% |
| Weekly | -3% | -5% | -3% |
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- Written by Michael Boutros, Currency Strategist with DailyFX
Follow Michael on Twitter @MBForex
