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EUR/USD Price Analysis: Bears fill-up on low hanging fruits left by the Fed

  • EUR/USD bears take profit and wait patiently in the wings for a retest of 1.1580. 
  • Bulls accumulating from daily support and eye a 50% mean reversion of the hourly bearish impulse ahead of NFP.

As per the prior analysis, EUR/USD sits tight ahead of the Fed, but bears ready to clean-up, followed by EUR/USD bulls come up for their last breath? and EUR/USD Price Analysis: Bears giving way, for now the bears have finally sunk their teeth into the low baring fruits of the Federal Reserve. 

The following illustrates the strength in the greenback and the subsequent downfall of the euro in and around the Fed meeting earlier this week and endorses more downside to follow.

EUR/USD weekly prospects to test 1.1500

Firstly, casting eyes over prior analysis, EUR/USD Price Analysis: Bears seeking a break below 1.15 the figure, the weekly chart was analysis as follows, forecasting a bear trend to test into the weekly fractal highs of the spring and summer below 1.15 the figure:

Since testing the 38.2% Fibo, the price is making headway in that respect:

Moving down to more recent price action, the bears have cleaned up from the discount that was on offer following the Federal Reserve as follows:

EUR/USD H1 chart, prior analysis

The W-formation was a compelling bearish reversion pattern that left the downside vulnerable and which has resulted in a break of support and given way to follow-through on Thursday as follows:

At this juncture, some consolidation would be the most probable outcome following such a sharp move to the downside. This is especially true ahead of the key risk event in the Nonfarm Payrolls and weaker hands that would prefer to take profits ahead of the weekend. Mitigation of the imbalance left behind could lead to a retest of the 1.1580s as follows:

From the daily support, the price is carving out a double bottom which would be expected to lead to a correction. A 50% mean reversion of the latest hourly bearish impulse comes in neat 1.1580 and the hourly wicks highs as a meanwhile target area. 

Author

Ross J Burland

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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