Macro Fibonacci Support Level In View For The EUR/USD

It has been a hesitant open on Wall Street with the U.S. indices slightly in the red. Traders are eagerly awaiting President Trump’s announcement regarding an extension of the Iran nuclear deal. While the equities markets are tepid, the USD is on the march against the majors. Big gains against the Euro, New Zealand dollar, Canadian dollar, and British pound have been the early-session highlights.

In a live market update from Monday, I outlined a key level of macro Fibonacci support for the EUR/USD. Today’s bearish action has brought this area into view.

EUR/USD Technicals

The daily chart for the EUR/USD is a textbook example of a downtrend. Price has yet to post a 38% retracement and has consistently broken out of consolidation to the bear.

If you are holding long-term shorts from mid-April highs, well done! The gains have been huge, over 500 pips. For now, there are three levels on my radar:

• Resistance(1): Psyche Level, 1.1900
• Support(1): Psyche Level, 1.1800
• Support(2): 38% Macro Retracement, 1.1708

Bottom Line: Last Friday I was calling for 1.2000 to be an area that was likely to draw both buyers and sellers to the market. This assertion has been proven false, as bearish sentiment continues to dominate the action by a wide margin.

For the remainder of the week, I will have buy orders queued up from just above macro support at 1.1711. This trade is a counter-trend play with a big upside. Using a 1:2 risk vs reward plan with an initial stop out at 1.1674, this trade is worth 74 pips on a short-term trend reversal.

Taking a counter-trend play with a large profit target is inherently risky. However, the EUR/USD is experiencing considerable action — if buyers defend 1.1708 in mass, a 100 pip bounce north is doable.

ABOUT THE AUTHOR See More

Shain Vernier

US Analyst

Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.

Related Articles

Forex Signals April 28: AMZN, AAPL, MSFT, META, CVX Earnings to Shake Markets

7 hours ago

Save

GBP/USD Watch: Pound Strength Fuels 1.3339 Breakout Hopes

10 hours ago

Save

EUR/USD Price Eyes $1.1481 as China Tariffs, ECB Bets Shake Markets

10 hours ago

Save

Comments

0 0 votes

Article Rating

Subscribe

Login

Notify of

new follow-up commentsnew replies to my comments

Please login to comment

0 Comments

Oldest

Newest Most Voted

Inline Feedbacks

View all comments