EUR/USD path of least resistance is to downside, despite the recovery – Confluence Detector

EUR/USD is consolidating its losses from last week and trying to recover in the wake of the new week. However, it may hit bumps in the road sooner rather than later.

The Technical Confluences Indicator shows that the resistance awaits the pair at 1.1406 where we see the convergence of the Pivot Point one-day Resistance 1, the Simple Moving Average 100-1h, the Fibonacci 38.2% one-month, the Fibonacci 38.2% one-week, the Bollinger Band 1h-Upper, the SMA 200-4h, and more.

If it manages to climb above this level, the next cap is quite close. At 1.1441 we see the confluence of the Fibonacci 61.8% one-week, the SMA 100-4h, the BB one-day Middle, and the Fibonacci 23.6% one-month.

Looking down, there are several cushions on the way down, but the most significant support level awaits euro/dollar only at 1.1323 where we see the Pivot Point one-day Support 2 and the PP one-month Support 1 converge.

Further down, 1.1270 could halt a sell-off. We see the confluence of the PP one-week Support 2 and last month's low at that low point.

All in all, the path of least resistance is to the downside. 

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.

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