Longer-term technicals suggest lower levels
EUR/USD:
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
April spent the best part of the month feasting on the top edge of demand from 1.0488/1.0912, squeezing out a Japanese hammer candlestick pattern, typically viewed as a bullish reversal signal.
May, as you can see, recovered off worst levels and wrapped up a few pips shy of monthly highs, with June extending gains and recently reconnecting with the lower ledge of supply at 1.1857/1.1352, eyeing possible engagement with long-term trendline resistance (1.6038).
With reference to the primary trend, price has exhibited clear lower peaks and troughs since 2008.
Daily timeframe:
Partially altered from previous analysis -
After two days of reasonably standout bidding, EUR/USD knocked on the doors of a potential reversal zone (PRZ), derived from a harmonic bearish bat pattern (comprised of an 88.6% Fib ret level at 1.1395, a 161.8% BC projection at 1.1410 and a 161.8% Fib ext. level at 1.1462 [red oval]).
It’s common to see traders sell PRZs and position protective stop-loss orders above the X point, in this case at 1.1495. Common targets fall in at the 38.2% and 61.8% Fib ret levels (derived from legs A-D) at 1.1106 and 1.0926, respectively.
In addition to the bearish configuration, the RSI indicator remains toying with overbought levels.
H4 timeframe:
EUR/USD swerved beyond the upper limits of supply at 1.1415/1.1376 in recent hours, throwing light on another supply at 1.1470/1.1447. Note the latter supply holds the upper boundary of the current daily PRZ, derived from the harmonic bearish bat pattern.
H1 timeframe:
The 1.14 level made an entrance in recent activity, albeit whipsawing to peaks at 1.1422. 1.1350 is set as the next support target on this timeframe, which, given the medium-term uptrend, could certainly hold ground.
Assuming a dip south of 1.1350, this will likely see price head for local support at 1.1317 (green). This is an interesting barrier having seen the base prove itself as both support and resistance recently. Despite its appeal, the threat of a whipsaw into orders at 1.13 is there.
RSI traders will also note minor bearish divergence present ahead of overbought levels.
Structures of Interest:
Intraday, the area between 1.13 and 1.1317, as aired in recent analysis, offers appealing support and could see price rebound from this barrier.
Longer term, though, we could be in for lower levels, having seen price engage with monthly supply at 1.1857/1.1352, as well as a daily harmonic bat pattern’s PRZ and H4 supply at 1.1415/1.1376.
Monthly timeframe:
(Technical change on this timeframe is often limited though serves as guidance to potential longer-term moves)
April spent the best part of the month feasting on the top edge of demand from 1.0488/1.0912, squeezing out a Japanese hammer candlestick pattern, typically viewed as a bullish reversal signal.
May, as you can see, recovered off worst levels and wrapped up a few pips shy of monthly highs, with June extending gains and recently reconnecting with the lower ledge of supply at 1.1857/1.1352, eyeing possible engagement with long-term trendline resistance (1.6038).
With reference to the primary trend, price has exhibited clear lower peaks and troughs since 2008.
Daily timeframe:
Partially altered from previous analysis -
After two days of reasonably standout bidding, EUR/USD knocked on the doors of a potential reversal zone (PRZ), derived from a harmonic bearish bat pattern (comprised of an 88.6% Fib ret level at 1.1395, a 161.8% BC projection at 1.1410 and a 161.8% Fib ext. level at 1.1462 [red oval]).
It’s common to see traders sell PRZs and position protective stop-loss orders above the X point, in this case at 1.1495. Common targets fall in at the 38.2% and 61.8% Fib ret levels (derived from legs A-D) at 1.1106 and 1.0926, respectively.
In addition to the bearish configuration, the RSI indicator remains toying with overbought levels.
H4 timeframe:
EUR/USD swerved beyond the upper limits of supply at 1.1415/1.1376 in recent hours, throwing light on another supply at 1.1470/1.1447. Note the latter supply holds the upper boundary of the current daily PRZ, derived from the harmonic bearish bat pattern.
H1 timeframe:
The 1.14 level made an entrance in recent activity, albeit whipsawing to peaks at 1.1422. 1.1350 is set as the next support target on this timeframe, which, given the medium-term uptrend, could certainly hold ground.
Assuming a dip south of 1.1350, this will likely see price head for local support at 1.1317 (green). This is an interesting barrier having seen the base prove itself as both support and resistance recently. Despite its appeal, the threat of a whipsaw into orders at 1.13 is there.
RSI traders will also note minor bearish divergence present ahead of overbought levels.
Structures of Interest:
Intraday, the area between 1.13 and 1.1317, as aired in recent analysis, offers appealing support and could see price rebound from this barrier.
Longer term, though, we could be in for lower levels, having seen price engage with monthly supply at 1.1857/1.1352, as well as a daily harmonic bat pattern’s PRZ and H4 supply at 1.1415/1.1376.
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