The EURUSD opened the North American session on the defensive, extending its decline after failing to hold above both the 100-hour and 100-day moving averages clustered near 1.1652–1.1657. The drop carried the pair below the 200-hour moving average at 1.16231, establishing that level as the near-term risk marker for traders during the session.
After hitting a new low in the U.S. morning trade, where the pair found support buyers near the upper edge of the swing area between 1.1581 and 1.1595. That bounce lifted EURUSD back to retest the 200-hour moving average, setting up a clear technical battleground. Sellers leaned against that level — and once again won the fight — pushing the pair back lower into the close.
The 200-hour MA now takes on added importance as a key resistance line for today and going forward. As long as price stays below 1.1623, sellers maintain control and downside pressure can continue. A break below 1.1581 would likely open the door for a retest of the double-bottom support near 1.15413, seen over the past two weeks.
Conversely, a move back above the 200-hour moving average would undermine the bearish case and shift the bias more neutral in the short term. Until that happens, sellers hold the stronger hand.
For traders it is important to understand who is in control (buyers or sellers), and why. The “why” allows traders to define the risk. If you know the risk and accept the risk, the targets become the focus. The key target is the double bottom. That is as obvious as the 200 hour MA.
This article was written by Greg Michalowski at investinglive.com.