EUR/USD path of least resistance is down after the consolidation – Confluence Detector
The EUR/USD consolidated its previous losses and stabilized below 1.1600. What's next? Rising may be harder than falling.
The Technical Confluences Indicator shows that that the pair faces a dense cluster of resistance lines at 1.1580 which is the confluence of the Simple Moving Average 100-15m, the Fibonacci 61.8% one-day, the Simple Moving Average 50-15m, the SMA 200-15m, the SMA 5-4h, the SMA 50-1h, and the SMA 10-4h.
Should the pair break above this level, there are quite a few lines of resistance with the 1.1645 level standing out as the convergence of significant levels: the Fibonacci 161.8% one-day, the Fibonacci 23.6% one-month, and also the Pivot Point one-day Resistance 2.
Even higher, a potent cap awaits at 1.1670 which is the confluence of the Pivot Point one-day Resistance 3, the SMA 50-4h, the Fibonacci 38.2% one-week, and the SMA 200-1h.
On the downside, the pair has support around 1.1538 which is the meeting point of the one-day high, the Pivot Point one-day Support 1, and the one-week low. Further down, 1.1510 is the one-month low, the Bolinger Band one-day Lower, the Pivot Point one-day Support 2.
The next significant level on the downside is only at 1.1442 which is the Pivot Point one-month Support 1.
Here is how it looks on the tool:
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.
Author
Yohay Elam
FXStreet
Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.
