Richard Perry
Independent Analyst
EUR/USD
Has this been another false move on EUR/USD. Early in yesterday’s session, the dollar bulls were on the ropes as the pair had pulled through the resistance of $1.1350. However, a failed upside break saw a turn lower to leave resistance at $1.1370 and form a negative candle. This has dragged the price back under $1.1300 and now threaten initial support at $1.1250 this morning. Already this move has breached what was a building mini uptrend and is certainly a disappointment for long positions looking for a breakout of what is still a medium term range. Does this now mean that EUR/USD will be swinging lower within the range back towards the lows around $1.1165/$1.1190 again? A close under initial support at $1.1250 may well determine this. Also watch daily RSI for a move below 50 which would suggest growing negative momentum bias. Our preference remains to buy into supported weakness within the range, so this move is likely to be the source of another chance to buy. Playing this range in recent weeks shows the need to have limited time horizons for long positions and active use of stops. The latest disappointment from yesterday once more reflects this as resistance has firmed between $1.1350/$1.1370.
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