EUR/USD Weekly Technical Outlook: Euro Looking for Buyers at Support
- EUR/USD backing off from 2008 trend-line in-line with expectations
- There is support at its feet to start the week, if it doesn’t hold look to sub-12100
- Benefit of the doubt still with a strong euro as long as support holds
To view the longer-term technical and fundamental outlook for the Euro, or to see our top trade ideas for 2018, check out the DailyFX Trading Guides.
Last week, the euro broke lower in-line with expectations after a double-top at the 2008 trend-line. It’s been a relatively aggressive decline so far, with support levels/lines coming into focus. Downward momentum stalled the final two days of last week at a slope extending over from May 2016.
It seems unlikely this slope will be the end of the decline, and if this holds true watch how it reacts at the trend-line just a shade lower rising up from December. There is price support at 12165 in near confluence with the trend-line, so as long as it doesn’t post a closing bar below then it could be enough to turn the euro higher.
Should the aforementioned support levels fail, there is major breakout support just beneath the 12100-level. This would be a fairly significant level to hold given a drop below would constitute a failed breakout, and since it would be taking place after turning down off the 2008 trend-line, it could mean a more meaningful decline is underway.
There is, however, one more line of support which also holds a good deal of importance. The trend-line extending higher since April has longer-term implications. It would require a solid drop from current levels to reach it, so if it does so this coming week oversold conditions at strong trend support would likely to lead to a strong snapback.
Overall, EUR/USD is still soft, but may find enough sponsorship in the days ahead to put together a solid bounce. But if it doesn’t soon, then look for shorts to continue winning the battle into more meaningful levels.
Check out these 4 ideas on how to Build Confidence in Trading
EUR/USD Daily Chart
Several levels/lines lie at the euro’s feet, which could put a bid in, but if they fail then look for meaningful levels to get tested in the days ahead.
Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.
—Written by Paul Robinson, Market Analyst
To receive Paul’s analysis directly via email, please SIGN UP HERE
You can follow Paul on Twitter at @PaulRobinsonFX