Yahoo Finance EUR/USD Mid-Session Technical Analysis for January 20, 2020
The Euro is trading lower against the dollar on Monday, pressured by last week’s series of U.S. economic reports that confirmed the U.S. economy is thriving. Trading volumes are thin as Lunar New Year approaches in Asia and with U.S. markets closed for Martin Luther King Day. Traders could also be trimming positions ahead of the European Central Bank meeting on Thursday.
At 13:11 GMT, the EUR/USD is trading 1.1085, down 0.0005 or -0.04%.
The strength in the U.S. economy underlines its relative outperformance versus the Euro Zone, although recent data point to a bottoming out in the European economy, as well as a recovery in China.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. The trend turned down earlier today when sellers took out the last main bottom at 1.1085. The trend will change to up on a move through the next main top at 1.1173.
The main range is 1.0981 to 1.1239. Its retracement zone at 1.111 to 1.1080 is potential support. The EUR/USD is currently testing this area. Trader reaction to this zone is likely to control the near-term direction of the single-currency.
The short-term range is 1.1239 to 1.1082. Its retracement zone at 1.1161 to 1.1179 is potential resistance.
Daily Swing Chart Technical Forecast
Based on the early price action and the current price at 1.1085, the direction of the EUR/USD the rest of the session on Monday is likely to be determined by trader reaction to the main Fibonacci level at 1.1080.
Bearish Scenario
A sustained move under 1.1080 will indicate the presence of sellers. The next target is another main bottom at 1.1067. This is a potential trigger point for an acceleration to the downside with the next target coming in at 1.0981.
Bullish Scenario
A sustained move over 1.1080 will signal the return of buyers. If this creates enough upside momentum then look for the rally to possibly extend into the main 50% level at 1.1110.
This article was originally posted on FX Empire
