Tests a swing area between 1.1987 and 1.19943
The price of the EURUSD as seen down and up and back down action in trading today. The low to high trading range is only 41 pips. The 20 dude day average is 62 pips. There is room to roam.
The current price is trading around 1.1995. The 1.1987 to 1.19943 area is a swing area which was a ceiling going back to April 14 until it broke higher on April 19. The old ceiling was retested on April 22, and held support (see red numbered circle 5). The lows today have been retesting that area and finding some cause for pause. A move below, and then below the 38.2% retracement of the move up from March 31 low at 1.19792, would have traders targeting the 200 day moving average and a lower swing area (see green numbered circles) between 1.19414 and 1.19506.
What would hurt the bearish bias?
- Not being able to get below 1.1987, and/or
- moving back above a swing area between 1.20125 and 1.20209 (see blue numbered circles in the chart above).
The EURUSD trended higher from the March 31 low to the hi reached on April 29. Three of the last four trading days have been to the downside (today the price is lower as well). On Monday, the pair retested its 200 hour moving average – peeking above the level briefly before rotating back to the downside. Yesterday, the price moved back below its 100 day moving average at 1.2050 currently and ran further away from that key moving average level.
The move higher in April took bullish steps along the way, that become target steps on the way down as well (yellow areas).