EURUSD Technical Play: Fed Monetary Policy Prep
Updated
EURUSD was boosted by Mario Draghi's remarks during Monday's session. The European Central Bank (ECB) governor expressed his content with wage growth and inflation but repeated rates may remain low beyond the summer of 2019.
The trade tension between the US and China has been dominating the market for some time and it is expected to be the main theme in the Forex market until the end of 2018.
Since 10th September EURUSD has been held in a bullish uptrend as evident from the 4hr chart. Selling on dips may have been a more appropriate strategy.
Although the currency pair appears to be attempting to correct higher at the time of this writing it may struggle with the 4hr resistance (upper blue line).
The 4hr uptrend is likely to lure many traders into EURUSD prior to the Fed monetary policy on Wednesday. The most likely outcome is a whipsaw reaction in an effort to clear stops below and above the trendline.
Based on our analysis there is a greater risk for moderate dip lower, the entry price may be more appropriate at a higher level (near the 4hr resistance) or should a bearish breakout take place in today's session.
The technical strategy is designed for the Fed monetary policy but may also kick into play in today's session should EURUSD break lower. Do note that this is a 4hr time frame, which may be broken down into shorter time frames for scalping by seasoned traders.
The trade tension between the US and China has been dominating the market for some time and it is expected to be the main theme in the Forex market until the end of 2018.
Since 10th September EURUSD has been held in a bullish uptrend as evident from the 4hr chart. Selling on dips may have been a more appropriate strategy.
Although the currency pair appears to be attempting to correct higher at the time of this writing it may struggle with the 4hr resistance (upper blue line).
The 4hr uptrend is likely to lure many traders into EURUSD prior to the Fed monetary policy on Wednesday. The most likely outcome is a whipsaw reaction in an effort to clear stops below and above the trendline.
Based on our analysis there is a greater risk for moderate dip lower, the entry price may be more appropriate at a higher level (near the 4hr resistance) or should a bearish breakout take place in today's session.
The technical strategy is designed for the Fed monetary policy but may also kick into play in today's session should EURUSD break lower. Do note that this is a 4hr time frame, which may be broken down into shorter time frames for scalping by seasoned traders.
Trade closed: target reached
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