EUR/USD Breaks Out Following Rejection Of 1.1300

Posted Thursday, November 1, 2018 by
Shain Vernier • 1 min read

In several live market updates from Wednesday, the team here at FX Leaders broke down the significance of the 1.1300 level as downside support. This area held to the pip as price reversed at 1.1301 for the second time this year. Now, the question is how far north will the EUR/USD rally? Are we in for a late-2018 return to levels seen last spring?

If so, the EUR/USD is off to a great start. Today’s 100 pip rally has shown the impact of fading uncertainty over the Brexit situation. Big gains by the Swiss franc, British pound, and Euro against the Greenback reinforce this point. For the moment, forex players have shown enthusiasm and fostered positive sentiment over a Brexit finance deal coming to pass very soon.

EUR/USD Technicals

At press time, the EUR/USD is banging against the 38% daily current wave retracement (1.1396). The proximity to the round number of 1.1400 is coincidental, yet is driving both buyers and sellers. A daily settlement above this level is likely to bring 1.1500 into play very quickly.

EUR/USD, Daily Chart
EUR/USD, Daily Chart

Overview: For the immediate future, the 1.1396 and 1.1400 levels are set up to be instrumental in this market. It is a key area where the current daily downtrend is going to be confirmed or invalidated. At the moment, the intermediate-term downtrend remains technically intact. However, this can change quickly if bids hit the EUR/USD above 1.1400.

With no real daily resistance present until the 1.1500 handle, any rally above 1.1400 is likely to be extensive. If the action continues, be sure to stay tuned to FX Leaders for ideas on how to take a few green pips out of this market.

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