Contradicting Charts in EUR/USD - Forex News by FX Leaders
EUR/USD is turning bearish on the H1 chart

Contradicting Charts in EUR/USD

Posted Wednesday, October 17, 2018 by
Skerdian Meta • 1 min read

EUR/USD turned bearish by the end of last month and the beginning of this month, losing around 400 pips in the process after it failed to break above the 100 smooth MA (red) on the daily chart. Although, it turned higher again last week, but it couldn’t break the 100 simple MA (green) this time so it didn’t reach the other moving average which stands nearly 200 pips higher.

The stochastic indicator became overbought already by the beginning of this week and the price formed a doji candlestick yesterday. These are two bearish signals on top of the resistance being provided by the 100 SMA (green). Today’s candlestick looks pretty bearish which completes the bearish reversal setup, so EUR/USD seems to be headed lower from the technical analysis of this chart.

The 100 SMA (green) is working as support on the weekly chart

But if we switch to the weekly chart, we can see a different picture. Here the stochastic indicator is headed down but it is almost oversold, which would mean a possible bullish reversal soon. Besides that, the 100 SMA (green) is providing support for EUR/USD on this time-frame.

Last week’s candlestick formed a doji or an evening star, whatever you want to call it, which is also a bullish reversing signal after EUR/USD trended down for two weeks. So, both charts are contradicting each other, but I think that the pressure is on the downside at the moment, so the daily chart should drive this pair in the next few days at least, if fundamentals don’t ruin things for us.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies

About the author

Skerdian Meta // Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
Related Articles

Leave a Reply

Notify of