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Price Action Webinar Archive from Sept. 1, 2020

Price Action Webinar Archive from Sept. 1, 2020

James Stanley, Senior Strategist

Price Action Talking Points:

  • This is an archived webinar that looked at FX pairs around the US Dollar.
  • The US Dollar put in a support test at a big area on the chart earlier today – but can it hold?
  • Correspondingly, EUR/USD put in a resistance test at 1.2000 – a level that hasn’t been traded at in over two years. Making matters even more interesting – this happened shortly after a disappointing inflation report that showed the Euro-area is already in a deflationary backdrop.
  • This webinar heavily utilized price action for the analysis: To learn more about price action, check out our DailyFX Education section, where it’s taught amongst a host of other candlestick patterns and formations.

US Dollar Puts in Support Test at Big Spot on the Chart

In this webinar, I looked through a series of FX setups with the US Dollar as a centerpiece. The Greenback put in a support test at a major area earlier this morning and this is a zone of prices that we’ve been following on these webinars over the past few weeks. I just published an article on this topic that looks a bit deeper into the matter, as there are three different support mechanisms all in near proximity to each other around the 92.00 handle on DXY. So far this morning this zone has helped to hold the lows; but its still early, and reversals are never a certainty. At this point, the focus would be on pullback potential in that bearish trend that’s been at work since March. After a pullback, then reversal potential can be investigated.

US Dollar Weekly Price Chart

US Dollar Weekly Price Chart

Chart prepared by James Stanley; USD, DXY on Tradingview

EUR/USD Reversal Potential at 1.2000

Going along with a that support theme in USD is a resistance item in EUR/USD, which has just tested the 1.2000 level for the first time in over two years. Making matters even more interesting is that this happened shortly after the Euro-area economy released inflation numbers indicating a return to negative inflation. So, it looks like the ECB will need to get to work in the coming months – rarely something seen as a bullish factor for a currency.

EUR/USD Daily Price Chart

EURUSD Daily Price Chart

Chart prepared by James Stanley; EUR/USD on Tradingview

GBP/USD Turns Before 1.3500

On the other side of the US Dollar, GBP/USD has had a fairly clean bullish backdrop over the past couple of weeks, even as USD-bears were somewhat neutralized by proximity to this big support. This highlights the potential for continuation, particularly if USD-bears are able to take out this current zone of support.

GBP/USD Four-Hour Price Chart

GBPUSD Four Hour Price Chart

Chart prepared by James Stanley; GBP/USD on Tradingview

--- Written by James Stanley, Strategist for DailyFX.com

Contact and follow James on Twitter: @JStanleyFX

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

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