So, EURUSD broke this channel as well, and now it remains to be seen how the pair will act outside of it. We have drawn a resistance trendline from above that will likely provide some selling pressure, but still how low the price can go is hard to tell. Especially given that this Wednesday a Fed meeting and press conference is scheduled, so watch out for wild price swings during and after the press conference.
To the downside, the path is not clear of obstacles. Notably, a strong Fibonacci support zone rests at 1.1075 (orange line) and immediately below it at 1.1040 the August low provides additional support. Maybe the pair will accelerate to the downside if it breaks through these 2 levels.
From the 4h chart, we can better see why 1.1075 is a strong Fibonacci support zone. A nice Gartley pattern has formed and we now need to see how the pair will trade around the support area of the pattern at 1.1075. A bounce will mean a potential reversal and if the market just blasts through it then the downtrend may gain even more momentum.
The middle weekly pivot point stands at 1.1195 which is the same as the most recent previous lows on this chart, hence the probability is high that the market will first retrace up to test both the weekly pivot and the lows near 1.12. Selling around this level will be the ideal scenario for a short trade.
The 1-hour chart just confirms how important is the resistance area around 1.12. Now, of course, we are assuming that the pair will retrace up to 1.12, and while that is very likely it doesn’t mean that it will certainly happen.
However, if it does, then EURUSD will meet strong resistance here because the broken support trendline of the blue channel (daily chart) plus a falling trendline and the prior lows are all converging around 1.12.
Our Recommended Binary Options Brokers to trade EURUSD:
Best Regulated Broker
IQ Option is the world’s leading EU regulated broker based with a revolutionary platform for all traders. Read IQ Option Review
- Best Trading App for Binary Options
- Minimum Deposit of only $10
- Minimum Trade of $1
- Trusted Broker
- $1,000 Virtual Funds ( Demo Account )
- Quick Withdrawals
- Outstanding Platform
- Weekly Tournaments
- Gain up to 92%*
Best US Broker
Finpari is a trusted international broker accepting clients from USA. Read Finpari Review
- They accept US clients
- 1-Hour Withdrawal
- Paypal & AMEX Accepted
- $1 Minimum Trade
- Huge Bonuses
- Highest Returns
- Weekend Trading
- Free Education
I've been a professional trader for over 5 years.
Currently I work as forex analyst for different investment companies.
Latest posts by James Martin (see all)
- BTCUSD – Weekly outlook for Bitcoin Price – November 21 2019 - November 21, 2019
- USDSGDWeekly outlook for Singapore Dollar – November 14 2019 - November 14, 2019
- BTCUSD – Weekly outlook for Bitcoin Price – November 7 2019 - November 7, 2019