EUR/USD Reverses out of Weekly Support Zone | Vantage FX

EUR/USD Reverses out of Weekly Support Zone

December 6, 2016

Two weeks ago, we spoke about the ten straight bearish daily candles in EUR/USD being the longest consecutive run of daily losses since 1999.

In the charts highlighted in that blog post, the daily being at the bottom of that massive green range was key. With a higher time frame level like that, buyers are sure to put up at least some sort of fight and a bounce was therefore expected.

I’ll leave you to look at the EUR/USD daily chart on your own MT4 charts, but price didn’t quite hit our support zone. We can see that price did get a small bounce, but the key now is following the Italian referendum no vote, price lurched down on the open back into our support zone.

This was the touch that the buyers needed and as you can see on the 15 minute chart below, price continued to rip higher throughout the day and the scenario played out.

EUR/USD 15 Minute:
Click on chart to see a larger view.

How often do we see the initial move on these sorts of news releases completely reversed by the end of the trading day (Trump anyone?)? Definitely another one of those ‘new normals’ that are sometimes hard to explain.

That’s markets for you!

Looking forward and the key level approaching is the previous pre-Trump swing low that we will look at the possibility of acting as resistance.

EUR/USD 4 Hourly:
Click on chart to see a larger view.

We’ll be watching to see what price does at this next obvious level of resistance, but just keep in mind that price has bounced off weekly support so while we should see some sort of pause, an intraday swing low isn’t going to act as a brick wall.

Just keep that in mind and wait for confirmation if you’re waiting to sell in the direction of the weekly trend seen here:

EUR/USD Weekly:
Click on chart to see a larger view.

There is no need to rush this trade. It’s going to give you an opportunity to get short again. Just be patient.

Do you see opportunity trading EUR/USD? Trade forex with leading Australian forex broker, Vantage FX.

Dane Williams – @VantageFX

Risk Disclosure: In addition to the website disclaimer below, the material on this page prepared by Forex broker Vantage FX Pty Ltd does not contain a record of our prices or solicitation to trade. All opinions, forex news, research, tools, prices or other information is provided as general market commentary and marketing communication – not as investment advice. Consequently, any person acting on it does so entirely at their own risk. The expert writers express their personal opinions and will not assume any responsibility whatsoever for the Forex account of the reader. We always aim for maximum accuracy and timeliness, and FX broker Vantage FX shall not be liable for any loss or damage, consequential or otherwise, which may arise from the use or reliance on this service and its content, inaccurate information or typos. No representation is being made that any results discussed within the report will be achieved, and past performance is not indicative of future performance.




Fast & Easy Account Opening Start Now!

  • Please enter a valid data!

  • Please enter a valid data!

  • Please enter a valid data!

  • Please enter a valid data!

  • Please enter a valid data!
Forex Promotions

Open a live account today to gain exclusive access to our 8 Forex Promotions. 

Find out more.