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EURUSD has played out well for us so far this week.
Back on December 24th, I wrote about the potential for a rally in 2019. However, the idea required a daily close above wedge resistance near 1.1450.
The “daily close” refers to the New York 5 pm EST close in Forex.
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It wasn’t until January 7th that euro bulls cleared wedge resistance. Then came the retest of the level as new support on the 8th.
I was already long the EURUSD at 1.1360 from January 4th. But the retest on the 8th allowed me to add to my position at 1.1425.
I announced both entries in the member’s area.
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You may have noticed that yesterday’s session cleared 1.1530. This is a level I’ve had my eye on for several months.
It isn’t a perfect level (they rarely are), but you can see how 1.1530 has directed price action since May of last year.
It’s too early to tell if buyers will respect yesterday’s close above it. But there’s little doubt that buyers are back in control at the moment.
Even if EURUSD doesn’t hold above 1.1530, there is now massive support in the 1.1450/70 region.
As such, any pullback into this area could present an opportunity to get long.
Now to discuss targets…
The 1,000 pip falling wedge that began in April 2018 suggests a long-term move to the 1.2400 area.
That may seem unrealistic to some, but I assure you it isn’t. Look no further than the run-up that began in early 2017.
A shorter term target is 1.1800.
The area served as key resistance between May and September of last year. It’s also the 50% retracement of the falling wedge (April – November 2018).
I also think 1.1620 and 1.1730 could prove significant on the way up.
But all in all, I’m bullish EURUSD and will continue to be a buyer as long as the pair holds above 1.1470.
Justin Bennett is an internationally recognized Forex trader with 10+ years of experience. He's been interviewed by Stocks & Commodities Magazine as a featured trader for the month and is mentioned weekly by Forex Factory next to publications from CNN and Bloomberg. Justin created Daily Price Action in 2014 and has since grown the monthly readership to over 100,000 Forex traders and has personally mentored more than 3,000 students.
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