Yahoo Finance EUR/USD Holding 1.1335 – 1.1300 Retracement Zone
The Euro is trading lower against the U.S. Dollar on Friday as safe-haven demand for the greenback may have eased a bit ahead of the weekend. Lower Treasury yields may also be giving the single-currency a boost.
Combining the price action over the last three days, however, suggests traders may be squaring positions ahead of next week’s major U.S. Federal Reserve monetary policy announcements.
At 13:47 GMT, the EUR/USD is trading 1.1349, up 0.0039 or +0.34%. On Thursday, the Invesco CurrencyShares Euro Trust ETF (FXE) settled at $105.04, down $0.43 or -0.41%.
In other news, Euro Zone government bond yields fell on Friday amid mixed signals from the European Central Bank (ECB) and increased demand for safe-haven assets as geopolitical worries over Ukraine mounted and equity markets fell.
Additionally, analysts highlighted that ECB President Christine Lagarde reiterated on Thursday that it did not need to act as boldly as the Federal Reserve because of a different economic situation, warning against the risks of premature rate rises.
It’s tough to get bearish the U.S. Dollar with little evidence of de-escalation surrounding the Russia-Ukraine tensions, the demand for safe havens – U.S. Dollar, Japanese Yen, Swiss Franc – keeps the upper hand for now.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart, however, momentum is trending lower.
A trade through 1.1272 will change the main trend to down. A move through 1.1483 will negate the closing price reversal top and signal a resumption of the uptrend.
The short-term range is 1.1186 to 1.1483. The EUR/USD is currently trading on the strong side of its retracement zone at 1.1335 to 1.1300, making it support.
The minor range is 1.1483 to 1.1301. Its 50% level at 1.1392 is the nearest resistance.
The main range is 1.1692 to 1.1186. Its retracement zone at 1.1439 to 1.1499 is additional resistance. It’s also controlling the near-term direction of the Forex pair. It stopped the rally at 1.1483 on January 14.
Short-Term Outlook
The direction of the EUR/USD into the close on Friday is likely to be determined by trader reaction to 1.1335.
Bullish Scenario
A sustained move over 1.1335 will indicate the presence of buyers. If this move creates enough upside momentum then look for a surge into the minor pivot at 1.1392.
Bearish Scenario
A sustained move under 1.1335 will signal the presence of sellers. This could trigger a break into the support cluster at 1.1301 – 1.1300.
Taking out 1.1300 could fuel another break into 1.1272. If this level fails then look for an acceleration into a pair of main bottoms at 1.1235 and 1.1222.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
