Resistance Levels In View For The EUR/USD
Today’s bullish action in the EUR/USD has taken rates north of 1.1375, toward three levels of topside resistance.
The EUR/USD has been on the bull throughout today’s forex session. Fueled by negative USD sentiment and the upcoming ECB Deposit Rate Decision, the Euro has been able to post nice gains vs the Greenback.
Be on the lookout for enhanced volatility in the coming 36 hours for the EUR/USD. Thursday’s U.S. pre-market session features the ECB Deposit Rate Decision and presser. Deposit Rates are expected to be held at -0.4%, with lending rates remaining at 0%. Also, as mentioned in an earlier update, the United States Senate is scheduled to vote on two proposals to end the ongoing government shutdown.
Ultimately, the results of these events are fairly certain. Consensus projections state that the ECB is to stay the course on rates and the Senate is to vote down both proposals. In the event any surprises come to pass, the markets will spring to life.
EUR/USD Technicals
Today’s bullish action in the EUR/USD has taken rates north of 1.1375, toward topside resistance. At press time, a daily close at or near 1.1400 is a possibility.
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Here are the key resistance levels to watch in this market:
- Resistance(1): Bollinger MP, 1.1419
- Resistance(2): 38% Current Wave Retracement, 1.1425
- Resistance(3): Daily SMA, 1.1430
Bottom Line: Converging indicators are a good thing. The area between 1.1419 and 1.1430 includes three and is set up to act as formidable resistance. Until elected, I will have sell orders queued up from 1.1421. With an initial stop at 1.1456, this trade produces 38 pips using a 1:1.5 risk to reward ratio.
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