EUR/USD Mid-Session Technical Analysis for May 6, 2019

James Hyerczyk
Updated

The Euro is pushing toward its high for the session after recovering from early session weakness that was fueled by a drop in demand for risky currencies. The catalysts for the early pressure were renewed concerns over U.S. –China trade disputes after President Trump announced new tariffs and the world’s second largest economy threatened to cancel this week’s trade negotiations.

At 15:30 GMT, the EUR/USD is trading 1.1197, down 0.0005 or -0.04%.

Daily EUR/USD
Daily EUR/USD

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 1.1112 will signal a resumption of the downtrend. A move through 1.1265 will change the main trend to up.

The main range is 1.1324 to 1.1112. Its retracement zone at 1.1218 to 1.1243 is resistance. The tone of the market can change if buyers are able to cross to the bullish side of this zone.

The Euro has also been straddling a major Fibonacci level at 1.1185 the past two weeks. This price is controlling the longer-term direction of the Forex pair.

Daily Technical Forecasts

Based on the early price action and the current price at 1.1196, the direction of the EUR/USD the rest of the session is likely to be determined by trader reaction to the downtrending Gann angle at 1.1205.

Bearish Scenario

Since the main trend is down, sellers came in at 1.1204 earlier today to stop the rally. This was just a little below the downtrending resistance angle at 1.1205. If this move creates enough downside momentum, then look for the selling to extend into the major Fibonacci level at 1.1185.

If 1.1185 fails as support then look for a further break into the uptrending Gann angle at 1.1172. This angle was tested earlier in the session. Look for an acceleration to the downside if this fails.

Bullish Scenario

Taking out 1.1185 will signal the return of buyers. This could spike prices into the 50% level at 1.1218. Taking out this level could trigger an extension of the rally into the downtrending Gann angle at 1.1235.

This article was originally posted on FX Empire

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