Last Friday’s short recommendation for the EUR/USD has performed beautifully. Upon Sunday’s open, the profit target was hit easily, producing a nice 90+ pip move to the bear. The trade setup was a basic Fibonacci retracement play with the prevailing trend.

So, what is next for the EUR/USD? This week will certainly bring us some opportunities to engage this instrument. Let’s take a look at the technicals, and some key support and resistance levels.

Technicals

Starting the trading week off on the correct foot is always a preferable scenario. Capitalising upon volatilities facing forex pairs is often a product of superior trade location.

EUR/USD, Daily Chart

A few key support and resistance levels to be aware of:

• Last week and September’s low of 1.1716

• August’s low of 1.1662

• 38% retracement level of 1.1826

Overview: For now, this market may enter a consolidation phase between the 38% level and the bearish support levels. If the EUR/USD continues to tighten between 1.1825 and 1.1700, playing rotation will be the trade.

Buys from the bearish support levels and sells from the 38% retracement are solid trade entries given the proper risk management parameters. Today’s close will provide an absolute range and a more defined trading plan moving forward.

As always, trade smart and for tomorrow!