The EURUSD dipped lower as popost-jobsolatility takes over. The technical’s are also in play in the EURUSD pair.
The run to the upside today was able to extend above its 200 hour moving average and 38.2% retracement of the move down from last week’s high at 1.1002. The break that the price to a high price defined by the 50% midpoint of the same move lower at 1.10303. Buyers turned sellers pushed the price back down.
However, the buyers held the support line at the 200 hour moving average and 38.2% retracement (you can add the natural support at 1.1000 as well), and the price has bounced.
Buyers are making a play. They took the price today above the 100-hour moving average (blue line) which stalled rallies last Friday, Monday, and again on Wednesday (give or take a few pips). The price also moved above the 200-hour moving average (greenline) which stalled the rise last Thursday. Moving above the 200-hour moving average was the 1st break above since July 30.
Of course, after trending lower, the burden of proof is still on the buyers to take out levels along the way. The next one is the 50% midpoint of the move down from last week’s high at 1.10303. That was not done. Getting above 1.10274 is the next target to get to and through.
If the retracement was of the move down from the July high (see chart below) and not the lower swing high from last week (see chart below), the 38.2% retracement comes in at 1.10493. That level is also close to the swing highs from last Friday and Monday, and represent another target on the topside.
So although buyers are making a play, and staying above the 100-hour MA keeps them in play, they still have work to do to solidify more control.
This article was written by Greg Michalowski at www.forexlive.com. Source