The EUR/USD is already 200 pips off the lows and in a recovery that cannot be described as a dead cat bounce. Where next?
The Technical Confluences Indicator shows that the pair faces only weak cluster of resistance on the way up. The 1.1710 to 1.1720 level features a confluence of several lines: the Fibonacci 38.2% one-week, the 15m high, and the Simple Moving Average one-day.
However, more serious resistance awaits only at 1.1780. This is the convergence of the Simple Moving Average 100-4h, the Pivot Point one-day Resistance 2, and the Pivot Point one-week Resistance 1.
Should the pair break higher, more serious resistance is only around 1.1825 which is the meeting point of the Pivot Point one-month Support 2 and the one week high.
On the downside, some support awaits at 1.1690, which is the confluence of the SMA 10-15m, the SMA 50-4h, and the Fibonacci 23.6% one-week.
Yet the most substantial support level is only at 1.1647 which is the congestion of the one-month low, the one-week low, the SMA 100-15m, the Fibonacci 23.6% one-day, the 4h high, and the Bolinger Band 15 minute Lower.
Here is how it looks on the tool:
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.