Prev: EUR/USD Finds Support at 1.35 with Room for a Corrective Rally to 1.3745 (9/12)

EUR/USD

• The EUR/USD has been consolidating to start the week. After a low of 1.3498, the market rallied to find resistance at 1.3695. (Roughly a bounce from 1.35 to 1.37.
• Then it found support twice at 1.3556 and established a range between 1.3556 and 1.37.
• The 1H Chart above shows that 1.37 is near the 23.6% retracement level of the swing from last week’s high to this week’s low so far.
• If the market pushes above 1.37, the next minor consolidation level (seen Sept. 9), is also at the 38.2% retracement level at 1.3797 (1.38).
• A more aggressive correction can see the 50% retracement level at 1.3889 (1.3890), which is also at a minor consolidation level seen on Sept. 8.
• Despite such a rally, the market would still be bearish in the medium term, unless there is a break above the 1.3980-1.40 zone. Otherwise, the current rally should be categorized as a correction rally.
• Failure to break above 1.37, and a break below 1.3556 starts the bearish continuation scenario.
• Then in the short-term if the market closes below 1.35 with a strong candle, we have near-term support immediately below at 1.3460. Then if the market pushes below 1.34, it opens up the 1.29-1.30 (2011 low – Dec. 2010 low) support range as target.

Subscribe and become a member to share your views and join live discussions as well as webinars about the markets.
Fan Yang CMT
Chief Technical Strategist
FXTimes

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.