EUR/USD - Neural chart setup ahead of ECB minutes release?
|- Yesterday's rebound from 20-day MA has neutralized immediate outlook.
- Focus on the ECB minutes.
EUR/USD ran into offers above 1.1963 (23.6% Fib R of Nov-Jan rally) earlier today and fell back to 1.1945 levels. Still, the immediate outlook remains neutral.
Karen Jones, Analyst at Commerzbank, says yesterday's strong recovery from the 20-day MA has neutralized the previously negative Elliott wave signals. Jones adds, "while above the 20-day ma at 1.1926 attention once more revert to the 1.2092 September high. Below 1.1926 will trigger losses to the 1.1853 uptrend."
That said, the failure to hold above 1.1963 seen today is discouraging and only boosts the odds of a break below 1.1926, especially if the treasury yields resume the rally.
All eyes on ECB minutes
Also, markets will scan the ECB minutes (due at 12:30 GMT) for nuances in the assessment of the new staff projections (including 2020), in particular on inflation. Also, US PPI and weekly jobless claims (due at 13:30) and comments from Fed's Dudley could influence demand for the US dollars.
EUR/USD Technical Levels
Haresh Menghani, Editor, and Analyst at FXStreet details the technical set up as follows-
"A sustained break below the 1.1925-20 immediate support would reinforce the bearish outlook and accelerate the slide towards 1.1885 support, marking 38.2% Fibonacci retracement level of 1.1554-1.2089 recent upswing. The downward trajectory could further get extended towards the 1.1800 handle, nearing 50% Fibonacci retracement level.
On the flip side, any up-move above 1.1970-75 immediate resistance might continue to confront fresh supply near the 1.2010-20 region, which if cleared might lift the pair back towards 1.2060-70 supply zone. The key upside resistance remains near the 1.2090 area - September 2017 yearly tops, above which the pair is likely to aim towards testing its next major hurdle near the 1.2165 region.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.