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The EURUSD is approaching a significant support area at 1.1075.
It’s a confluence of support as it’s the intersection of a key horizontal level and the ascending channel support from the 2019 low.
This 1.1075 handle is one of two regions I pointed out on December 27th.
In that post, I mentioned how it would take a breakout from 1.1200 resistance or 1.1075 support for the EURUSD to regain momentum.
We saw the euro test that 1.1200 region during the last two trading days of 2019, but buyers failed to close the pair above it.
Now it’s the turn of 1.1075 to hold just as 1.1200 did last week.
But will it hold as support?
That should be the question on everyone’s mind.
If it does, we could see the EURUSD rotate higher once more to retest the descending channel top, which is now closer to 1.1180.
And if 1.1075 support doesn’t hold, it could signal the end of the euro’s short-term uptrend that began with the 2019 low last October.
It’s times like this that it pays to be patient, literally.
As of this writing, the EURUSD is in no man’s land, caught in a sideways range with little to no directional bias.
That said, the technicals are holding up beautifully.
The descending channel top (formerly at 1.1200) did its part last week, so I have no reason to think we won’t get a reaction at 1.1075 support.
I think we’re getting close to a breakout, but I stand by what I wrote on December 27th.
That it’s going to take a daily close below 1.1075 or above 1.1200 (now closer to 1.1180) to trigger a breakout.
Remember that I use New York close Forex charts. That means each 24-hour session opens and closes at 5 pm EST.
These charts are essential for trading price action as they give you five equal daily candles every week. Go here to get access to the charts I use.
A close below 1.1075 would target 1.0990, while a break above 1.1180 would expose the 1.1280 to 1.1300 region.