Interesting price structure on EU currently

9 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.

In the early stages of April, the technical foundation has price rangebound between the two aforementioned price structures; notably, however, April’s candle is currently nearly 1% lower, testing the upper boundary of 1.0488/1.0912.

The primary downtrend remains in motion, trading lower since 2008 and exhibiting clear lower peaks and troughs.

Daily timeframe:

Partially altered from previous analysis -

Europe’s single currency chalked up a relatively spirited recovery vs. the greenback Thursday, buoyed on the back of a 78.6%/61.8% Fib retracement zone at 1.0745/1.0830 (pink).

North of the noted Fib base, the 200-day SMA at 1.1062 offers a layer of resistance, while a breakout north of here shines the flashlight on supply at 1.1239/1.1179, along with trendline resistance (1.0879).

H4 timeframe:

Thursday’s advance north of support at 1.0831 came about as the US dollar index folded over and reclaimed 100.00 to the downside, weighed by dismal US unemployment claims and further easing from the Fed.

The Federal Reserve took additional actions to provide up to $2.3 trillion in loans to support the economy. This funding will assist households and employers of all sizes and bolster the ability of state and local governments to deliver critical services during the coronavirus pandemic .

The move higher eclipsed Tuesday’s high at 1.0925 and is poised to reconnect with supply at 1.1044/1.0966, which comes with a nearby 50.00% retracement value at 1.0954 and a 127.2% Fib ext. level at 1.0973.

H1 timeframe:

Intraday flow mid-way through London on Thursday toppled the 1.09 region in strong fashion, clearing the path north for price to address 1.0950 into US hours. The reaction off 1.0950 has so far been reasonably modest, echoing the possibility of a resumption to the upside today, targeting a somewhat large supply at 1.1033/1.0982 which houses the widely watched 1.10 level and channel resistance (1.0925).

Technicians will also note the RSI momentum indicator recently faded overbought territory and produced bearish divergence.

Structures of Interest:

Coming from monthly demand at 1.0488/1.0912, alongside buyers latching onto a strong bid from 1.0745/1.0830 on the daily timeframe, an intraday push through 1.0950 could be seen on the H1 timeframe today. However, breakout buyers may encounter fresh selling off the 50.00% retracement value at 1.0954 and a 127.2% Fib ext. level at 1.0973 on the H4 timeframe, which envelope the lower boundary of a supply base at 1.1044.

Ultimately, technical studies could see 1.10 brought into view on a breakout above 1.0950, though may struggle to pencil in much thereafter.