1.08 exhibiting strong confluence as support

16 апр. 2020 г.

EUR/USD:

Monthly timeframe:

(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)

March, evident from the monthly chart, left behind a long-legged doji indecision candle, with its extremes crossing paths with heavyweight demand-turned supply at 1.1857/1.1352 and demand at 1.0488/1.0912.

The technical foundation has April rangebound between the two aforementioned price structures; notably, however, the current monthly candle is seen tunnelling into the upper boundary of 1.0488/1.0912.

The primary downtrend has remained in motion since 2008, exhibiting clear lower peaks and troughs.

Daily timeframe:

Partially altered from previous analysis -

Despite a recovery from the 78.6%/61.8% Fib zone at 1.0745/1.0830 (pink) early last week, in the space of two successive bearish candles we’re re-entering the said Fib base. In the event the mood remains sour, demand at 1.0526/1.0638, an area extended from March 2017, might elbow its way back into the spotlight. Sited just south of a 127.2% Fib ext. level at 1.0672, we can also see an ABCD correction (orange) merging with the current demand at 1.0614.

H4 timeframe:

A clear victim of broad dollar strength observed Thursday’s action cross paths with support at 1.0831. Pattern traders will also note the recently formed ascending wedge has its take-profit target, measured by taking the base and adding this to the breakout point (green), set around 1.0784.

Stepping south of the said supports may eventually see demand at 1.0602/1.0630 surface, drawn from April 2017, as supportive structure appears limited.

H1 timeframe:

Fading the 100-period SMA, organised as a shooting star Japanese candlestick pattern, was, alongside a strong dollar bid, clearly enough to abandon 1.09 Thursday. Interestingly, we retested the underside of the said round number heading into London and again in early US trade before sailing through 1.0850.

1.08 calls for attention going forward, aligning closely with an ABCD bullish pattern (orange) around 1.0802.

Structures of Interest:

The combination of the H4 ascending wedge’s take-profit target at 1.0784, the 1.08 handle and H1 ABCD correction at 1.0802, along with the daily Fib zone between 1.0745/1.0830 and the H1 RSI indicator trekking oversold terrain could be enough to tempt buyers to make a show from 1.08 should we make it this far south today.