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The EURUSD has a decision to make.
I’ve discussed the significance of the confluence of support at 1.0990 for several weeks now.
It’s a key horizontal level based on the lows and highs since September.
The 1.0990 area is also the bottom of an ascending channel that extends from the year-to-date low.
Of course, we’ve yet to see the EURUSD test that channel bottom, but I’m confident it will attract buyers on a retest.
1.0990 was also the breakout point for the euro in October.
If that wasn’t enough, 1.0990 is the 61.8% Fibonacci retracement of the October range, which was a bullish engulfing candle.
All of the above is why I dislike selling the EURUSD while above 1.0990.
But at the same time, the pair just carved a lower high on the daily time frame.
That means I’m not interested in buying either.
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This is one of those situations where I need more information from the EURUSD in order to make a decision one way or the other.
A daily close below 1.0990 could present a selling opportunity, perhaps for a move to the year-to-date lows below 1.0900.
Alternatively, bullish price action from 1.0990 would keep the pair afloat a while longer.
It could also re-expose the 1.1070 resistance area.
I wouldn’t expect too much movement from the EURUSD, or any pair this week, though.
The U.S. Thanksgiving holiday on Thursday means volume will be lower than usual during the second half of the week.
Even now we aren’t seeing much movement in the currency market.
For that reason alone, I’ll be scaling back on my trading frequency and any position sizing this week.