EURUSD – Approaching Key Support Zone

EURUSD is on course to extend its losing streak to five consecutive sessions today but despite this, it still appears to be in correction mode, rather than the early stages of a reversal.

The pair is currently finding support around 1.1140 – the 38.2% retracement of the move from 10 March lows to 18 March highs and the top of the Ichimoku cloud on the daily chart.

EURUSD Daily

While this could be a logical reversal level if it is going to continue its push higher, I haven’t yet seen a convincing reversal pattern in the price action that would convince me the pair has turned bullish. A break above 1.1187 – resistance since yesterday afternoon on a number of occasions – may be that bullish signal.

If instead the pair rotates back to the downside, the next key level could be 1.1080. At this level, the 50 fib level coincides with the bottom of the Ichimoku cloud on the 4-hour chart and its bullishness will be truly tested.

EURUSD 4hr

This also lies within the cloud on the daily chart, which suggests it remains bullish and would represent a logical area for a reversal back to the upside.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam
Craig Erlam

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