The euro is at a 6-month high in expectation of the release of the first euro zone data. Traders are looking at the revised GDP figure in an anticipatory mode due to the uncertainty of the ECB’s stimulus program and how fast the EU would scale it back. If fundamentals were left aside, the short-term picture is as shown above.
The Technicals:
We have the EURUSD 4 Hour chart and a significant resistance level just around price.
Current price: 1.1020
Resistance zone: 1.1000-1.1020
TP1/Support #1: 1.0850
TP2/Support #2: 1.0750
Scenario 1: Based on the figures above, if the EURUSD was to reverse direction, the first support level is our take profit zone and is standing at 1.0850. The second take profit level is the support level at 1.0750.
If the EURUSD is to break out from the current resistance zone, price action traders will be looking at the figures below.
Current price: 1.1020
Resistance-turned-Support zone: 1.1000-1.1020
TP1/Support #1: 1.1300
TP2/Support #2: 1.1600
Scenario 2: Based on the breakout scenario, the current resistance will act as a support. Traders will be looking to take profits first at 1.1300. If that level holds, then they will overlook the next take-profit level at 1.1600.
Guest post by colibritrader
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