Talking Points
EURUSD testing key support region ~ 1.29
1.2980/86 weekly opening range high & interim resistance
Major event risk on tap this week
EURUSD Daily Chart
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
EURUSD short bias at risk ahead of key support 1.2895 – 1.2903
Scalp bias invalidation at 1.2980/86- breach targets 1.3018/20 (monthly bias invalidation)
Subsequent resistance objectives at 1.3158 & 1.3205/27- key resistance
Support break sub-1.2895 targets objectives at 1.2787, 1.2743 & 1.2660
Daily RSI resistance triggers pending- break would suggest recovery
Momentum signature holding sub 30- bearish
Event Risk Ahead: US & Eurozone Consumer Price Index(s) & FOMC Rate Decision on Wednesday, US Building Permits, Housing Starts on Thursday
EURUSD 30min Chart
Notes: The EURUSD decline has failed to close below key near-term support at 1.2895-1.2905 and the short-bias is at risk while above this threshold. Interim resistance stands just above the weekly opening range high / last week’s highs at 1.2980/86 and a breach above shifts the scalp bias higher targeting a Fibonacci confluence at 1.3018/20- a level if overtaken shifts the monthly bias back into neutral while below the September high at 1.3158.
Bottom line: looking for a break last week’s range with a breach above 1.3020 shifting the focus back to the September highs. Our broader outlook remains weighted to the short-side while below 1.3227 with a break/close sub-1.2895 targeting support objectives into the 2013 lows. Caution is warranted heading into significant event risk this week with Wednesday specifically likely to fuel added volatility in USD crosses. Follow the progress of this trade setup and more throughout the trading week with DailyFX on Demand.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Key Threshold Grid
Entry/Exit Targets
Timeframe
Level
Technical Relevance
Resistance Target 1
30min
1.2947
61.8% Extension
Bearish Invalidation
30min
1.2979/86
1.618% & 100% Fib Extension(s)
Break Target 1
Daily / 30min
1.3018/19
78.6% & 50% Retrace(s) / 1.382% Ext
Break Target 2
30min
1.3044/50
61.8% Retracement / 1.618% Ext
Break Target 3
30min
1.3094/98
78.6% Retracement / H&S Objective
Break Target 4
Daily / 30min
1.3158
September ORH
Break Target 5
Daily
1.3205/27
100% Ext / 61.8% Retrace / (1.3238 Gap Fill)
Bullish Invalidation
Daily / 30min
1.2895 – 1.29
88.6% Retracement / 1.618% Ext
Break Target 1
30min
1.2858/68
2.618% Extension / 2014 Low
Break Target 2
30min
1.2800
Psychological Barrier / Soft Support
Break Target 3
Daily / 30min
1.2787
61.8% Retracement (2012 Lows)
Break Target 4
Daily / 30min
1.2743
2013 Low / June 2012 High
Break Target 5
Daily
1.2715
200% Extension
Average True Range
Daily (20)
69
Profit Targets 18-20pips
*ORH: Opening Range High
*ORL: Opening Range Low
Other Setups in Play:
AUDCHF Monthly Opening Range Setup- Scalps Target Key Support
AUDUSD Scalps Target Head and Shoulders Break- Bearish Sub 9236
GBPJPY Pitchfork Setup- Scalps Target Sunday Gap
Key Levels for NFPs – EURUSD, USDJPY & USDOLLAR in Focus
AUDCHF Gap Setup- 8545 Resistance Critical
Make or Break Time for USDCHF- Rally Vulnerable Sub 9133
—Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list
Join Michael for Live Scalping Webinars this week Tuesday – Thursday on DailyFX Plus (Exclusive of Live Clients) at 12:30 GMT (8:30ET)
Interested in learning about Fibonacci? Watch this Video
Source: Daily fx
