EUR/USD Forex Technical Analysis – Strengthens Over 1.2197, Weakens Under 1.2151 – Yahoo Finance
The Euro is edging higher late in the session on Wednesday as dovish testimony from Fed Chair Jerome Powell bolstered concerns about rising inflation.
Powell reiterated on Wednesday that U.S. interest rates will remain low and the Fed will keep buying bonds to support the U.S. economy. The Fed’s commitment to low rates has some investors worried that inflation could spike on passage of further fiscal stimulus.
Powell’s remarks to the House Committee on Financial Services mirrored his testimony before the Senate on Tuesday.
At 20:33 GMT, the EUR/USD is trading 1.2160, up 0.0012 or +0.10%. This is up from an earlier low of 1.2109.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart, however, momentum is trending higher. The main trend will change to up on a trade through the last main top at 1.2190. A move through 1.1952 will reaffirm the downtrend.
The minor trend is up. This is controlling the momentum. The minor trend will change to down on a move through 1.2023. Taking out 1.2180 will make 1.2109 a new minor bottom.
The short-term range is 1.2349 to 1.1952. The EUR/USD is currently testing its retracement zone at 1.2151 to 1.2197. This zone is controlling the near-term direction of the Forex pair.
The main retracement zone support is 1.2074 to 1.2010. This zone is protecting the downside against a steep break.
The direction of the EUR/USD into the close on Wednesday and perhaps early Thursday will be determined by trader reaction to the short-term 50% level at 1.2151.
A sustained move over 1.2151 will indicate the presence of buyers. This could lead to a rally into a cluster of levels including the minor top at 1.2180, the main top at 1.2190 and the main Fibonacci level at 1.2197.
The daily chart shows there is plenty of room to the upside over 1.2197 with the main top at 1.2349 a potential target. Therefore, we’re looking at 1.2197 as a potential trigger point for an acceleration to the upside.
A sustained move under 1.2151 will signal the presence of sellers. This is also a potential trigger point for an acceleration to the downside with 1.2074 the next likely target price.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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