EUR/USD could extend falls even if stocks recover – Confluence Detector

EUR/USD fell back to the bottom of the range after it got carried down with stock markets. What's next? The path of least resistance is down.

The Technical Confluences Indicator shows that the world's most popular currency pair is mired in the 1.1316-1.1328 region which is a dense cluster of levels including the Fibonacci 61.8% one-month, the Simple Moving Average 5-15m, the SMA 10-15m, the Fibonacci 38.2% one-week, and the Bollinger Band 15m-Lower. 

If the pair recovers from current levels, fierce resistance awaits at around 1.1355 which is the convergence of the SMA 5-4h, the Bollinger Band 4h-Middle, the Bollinger Band one-day Middle, the SMA 10-4h, the SMA 100-4h, the Fibonacci 38.2% one-day, the SMA 200-1h, and the Fibonacci 61.8% one-week.

Looking down, we see weak support at around 1.1264 which includes the Pivot Point one-day Support 2, the PP one-month S1, last week's low, and the Bollinger Bands one-day Lower.

Further down, 1.1199 is the confluence of the PP one-week S2, the PP one-week, S3, and the PP one-month S1.

All in all, the downside is more appealing than the upside .

Here is how it looks on the tool:

EURUSD technical confluence December 5 2018

Confluence Detector

The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.

This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.

Learn more about Technical Confluence

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 securities. 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 Forex 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.

RELATED TOPICS