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EUR/USD Mid-Session Technical Analysis for February 21, 2018

By:
James Hyerczyk
Published: Feb 21, 2018, 14:02 UTC

Based on the early trade, the direction of the EUR/USD today is likely to be determined by trader reaction to the steep downtrending Gann angle at 1.2315.

EUR/USD

The EUR/USD is trading lower ahead of the release of the Fed minutes later in the session at 1900 GMT. Earlier today, German PMI dipped to 60.3, slightly below the forecast of 60.6. Euro Zone PMI also fell short of its 59.2 estimate with a reading of 58.5.

In the Fed minutes, traders will be looking for hints regarding future rate policy, and any signs of plans to raise interest rates more than three times in 2018.

EURUSD
Daily EUR/USD

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has shifted to the downside. A move through 1.2555 will signal a resumption of the uptrend. A trade through 1.2205 will change the main trend to down.

The short-term range is 1.2205 to 1.2555. Its retracement zone at 1.2380 to 1.2339 is currently being tested. Trader reaction to this zone should set the tone of the market over the near-term.

The main retracement zone target is 1.2235 to 1.2160. This zone stopped the selling on February 9 at 1.2205. Also inside this zone is a long-term 50% level at 1.2166.

Daily Technical Forecast

Based on the early trade, the direction of the EUR/USD today is likely to be determined by trader reaction to the steep downtrending Gann angle at 1.2315.

A sustained move under 1.2315 will indicate the presence of sellers. This could lead to a quick drop into an uptrending Gann angle at 1.2285. Since the trend is up, we could see a technical bounce on the first test of this angle. This angle is also a trigger point for an acceleration into 1.2235, followed closely by an uptrending Gann angle at 1.2226.

Another trigger point for an acceleration to the downside is 1.2226. Breaking this angle could lead to a test of 1.2205, followed by 1.2186, 1.2166 and 1.2160.

Trading on the strong side of the downtrending Gann angle at 1.2315 will signal the presence of buyers. The first upside target is 1.2339.

Overcoming 1.2339 could trigger an acceleration into an uptrending Gann angle at 1.2365, followed by 1.2380.

Look for a further acceleration to the upside over 1.2380 into a downtrending Gann angle at 1.2435.

Expect volatility today because the Fed minutes are going to shake up the markets. Hawkish minutes will be bearish for the EUR/USD.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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