In the weekend forex report video (watch by clicking on the link above), I outline the price action last week, the technical breaks and the key barometers and bias defining levels in play for the major currency pairs (PS the EURUSD analysis begins near 8:00 mark on the video above).
For the EURUSD, the pair settled the week at a swing area between 1.03485 and 1.03653. That would be the key barometer to start the week.
On the downside, the closest target if the ceiling held, would be the 1.0273 to 1.02935 swing area which is joined by the 38.2% of the 2022 trading range at 1.0284.
In trading today, looking at the daily chart, the low for the day reached 1.0271 – just below the low of the swing area at 1.0273. The high for the day reached 1.0350, just above the low of the higher swing area.
The current price is at 1.0311 – between the swing area (and above the broken 38.2% retracement).
So, apart from a two pip break the technicals are doing their job with a 79 pip trading range.
However, what we know is the range is not going to stay at 79 pips. It may for the day, but there is a long way to go still, and the stock market has yet to start of course. The economic calendar is empty, but in these markets it does not take much to goose the market one way or the other.
Look for a break.
With the price lower for the day, the shorter term intraday traders may be leaning toward a correction lower, but that does not have to be. Looking at the 5 minute chart below, the low today – in addition to stalling near the low of a swing area on the hourly chart – did stall in the 38.2-50% correction zone of the trend move higher from Friday (that midpoint comes in at 1.02629). Buyers leaned in the area, and have pushed the price back higher.
The price is currently trading above and below the near converged 100/200 bar MA on the 5-minute chart. So the “market” is still working out the directional move. It is simply not sure yet, but it can go either way.