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But finding resistance at the 50% of the move down from last week’s high
The EURUSD has retraced back higher today (the EUR is the strongest), and in the process has moved to test the 50% retracement of the move down from last week’s high to the low reached yesterday.
Along the way, the pair was able to get back above the broken trend line, and a downward sloping trend line connecting highs from January 7 and January 13. The pair also more recently cracked above the 100 hour MA at 1.21176 area. That level is where the 38.2% is currently at as well, increasing the levels importance today. Stay above is more bullish. Move back below and the buyers will be questioning the “legs” in the run higher.
On the topside, the pair is stalling against the 50% retracement at 1.21376 and a swing area between 1.21315 and 1.21364 (see red numbered circles). If the price can extend above each, the buyers would look toward the 61.8% at 1.21576 and the 200 hour MA green line at 1.21625.
SUMMARY: Buyers have been able to push higher today. They have cracked above some close resistance targets giving the buyers some confidence including the 100 hour MA and the 38.2% of the move down from last week’s high. However, if the buyers are to remain confident, there has to be more levels taken out above (remember, the corrective move is just off the most recent leg lower, not the move down from the January 6th high). So the gains are the minimum to give buyers some hope. Nevertheless, if the topside levels outlined can be broken, they would increase their control. Fail back below the 100 hour MA/38.2%, and the correction is just a plain vanilla variety