EUR/USD path of least resistance is up on Fed Day – Confluence Detector
EUR/USD is holding up close to 1.1400, above the lower levels seen in previous sessions, but well within the range. Tension mounts ahead of the all-important Fed decision later in the day. Where will the pair go to? The technical levels point to a higher potential to the upside.
The Technical Confluences Indicator shows that the most significant cluster of levels is below the current price. At 1.1340 we see the convergence of the potent Fibonacci 38.2% one-week, the previous day's low, the Pivot Point one-day Support, and the Fibonacci 61.8% one-month.
A bit higher, close to the current levels, we see another dense cluster of support at 1.1363. The area includes the Simple Moving Average 200-1h, the SMA 5-4h, the SMA 200-4h, the Fibonacci 61.8% one-day, the Bollinger Band 1h-Lower, BB one-day Middle, and the SMA 10-one-day.
On the upside, we see an area of resistance around 1.1400, but the lines are not that robust and are somewhat spread out. These include the Pivot Point one-day R1, the BB 4h-Upper, yesterday's high, the SMA 5-one-day, the BB 1h-Upper, the Fibonacci 23.6% one-day, and the Fibonacci 38.2% one-month.
The next cap is at 1.1434, but it is already somewhat weaker. We see the confluence of the Fibonacci 23.6% one-month, the PP one-day R2, and the previous week's high.
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.
