Forex Technical Update
The EUR/USD broke into new lows for the week, coming down to the 1.2660 level at the beginning of the 5/17 US trading session. The 1.2625-1.2660 support area has been documented at FXTimes on the daily chart. On the 4H chart, we see that the market could be already developing a bullish divergence with the RSI (lower price low, higher RSI low), as well as a bullish divergence with the Bollinger Band (lower price low, but second price low failing to break across the band after the previous low did).
*The bollinger band here is 3 standard deviations from the 200SMA.
The daily chart shows that the free fall might be slowing. For counter-trend traders this offers a better scenario to go long here than trying to catch a falling knife. The buy-EUR/USD-trade-plan here should have a stop below 1.26 and a conservative target to 1.28, with an aggressive target to 1.29.
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist of FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.