The EURUSD is trading in a narrow 50 pip trading range. That is on the low end of the 94 pips range average seen over the last 22 trading days.
Looking at the hourly chart, the EURUSD is trading right near the 100 and 200 hour moving averages (blue and green lines) which are in the middle of the trading range from 1.0470 up to 1.0641 that has confined the trading range since April 27 (9-10 trading days). The 100 hour moving average (blue line) currently at 1.05546 held support in the Asian session today. That moving average was broken in the London morning session, but the 200 hour moving average stalled the fall near 1.05386.
The current price is back above both moving averages at 1.0564 keeping the buyers more control in the short/intermediate term.
On the topside, the 1.0592 to 1.05986 area is home to some swing levels from the April 29 and again on May 6 and yesterday. Move above that area and traders will start to look toward the high price from last week up near 1.0641. Recall that high stalled just ahead of the 38.2% retracement of the move down from the April 21 high at 1.06480. That stall ahead of the 38.2% retracement disappointed the correction buyers (it is a plain-vanilla correction) , and resulted in the move down toward the lower extreme of the recent range on Thursday and Friday of last week.
Overall, staying above the moving averages keeps the buyers in the drivers seat. However, a break below would tilt the bias in the opposite direction.
When trading in a up and down confined range, the moving averages become barometers, and the swing levels/areas become the targets. Those levels/areas could also become resistance or support depending on which way the market is breaking (and who is in control). Right now with the moving averages holding support, the buyers remain in control, but there is work to do to get through the swing levels on the topside. Failure to do that – and will below the 100/200 hour moving averages - would tilt the bias in the opposite direction.
