Euro / Dollar Technical Forex Analysis for Forex Traders

The Euro fell heavily during yesterday’s Asian session, then it resumed the drop during the European session. After stopping just below the enormous resistance we talked about in Monday’s report 1.2920 (Monday’s high was 1.2916), we saw the Euro fall, breaking yesterday’s support 1.2777 and successfully reached the first suggested target at 1.2690. With this drop, the price has broken 3 critical levels at once: 1. the rising trend line from Aug 31st (which was broken at 1.2860), 2. the falling trend line from Sep 1st top and 3. the massive support at 1.2777. This has shifted the short & medium terms’ technical outlook to the negative territory! But on the other hand, after the big drop, chances of seeing a correction before resuming the journey south are massive. The ideal target area for a short term correction is from 1.2767 to 1.2824. Therefore, today’s best strategy may be selling if the price rebounds to this area. Short term resistance is at 1.2824, we do not expect it to be broken today. But if it is broken, we will jump to 1.2912 & 1.2972. Support is at 1.2698, and a break here would target 1.2627 and may be at a later time 1.2522.

Support:

• 1.2698: obvious & attractive horizontal support on intraday charts.

• 1.2627: Aug 31st low.

• 1.2522: Jul 13th low.

Resistance:

• 1.2824: Fibonacci 61.8% for the drop from Monday’s high.

• 1.2912: the retest level for the rising trend line from Aug 31st low on the hourly chart.

• 1.2972: the top of the rising trend channel on the hourly chart.