Forex Technical Update
The 1H EUR/USD chart shows the market failing to trade in a rising channel after it hit 23.6% retracement of the December dip from 1.3549 to 1.2944. Now it appears price action is turning bearish after it anchored out of the channel. Note that the market is trading below the 200 hour simple moving average, and is also trading around the smaller moving averages (100, 55, 21, and as they converge. A bearish continuation attempt is signaled if price action breaks away form this MA congestion. As the market gears up for the US session, price action has been very subtle, but the bearish candles are relatively more convincing than the bullish ones.
A hold below 1.3050 along with a break below 1.30 in the US session should point the the market toward the 1.2944 low. Below that awaits the next key support level at the 2011 low near 1.2870.
However a break above 1.3050 opens up near term high of 1.3085 (near 23.6% retracement), and then the 38.2% retracement at 1.3175, which will be key since it will be close to the 200-hour SMA.
Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources