EURUSD is testing a bullish breakout point on Wednesday. Will bulls target 1.1660, or is this yet another lower high within the downtrend?
Watch today’s video for key insights, including key levels to watch for EURUSD and DXY, and targets to keep on your radar later this week.
The forex market has been relatively slow this week. The lack of news events due to the US government shutdown is taking its toll on volatility.
That said, the technicals for pairs like EURUSD and the DXY remain surprisingly clean.
EURUSD is battling the 1.1608 September low this week. Sellers defended the area on Tuesday, but the euro is crawling back to the level on Wednesday.
We also have a key descending trend line resistance from September, just below the September low. Currently, the trend line comes in a few pips below 1.1600.
If EURUSD can break the 1.1600-1.1610 resistance area with conviction, we could get the push into the 1.1660 highs from October.
There’s an unfinished auction at 1.1665. These tend to be targeted by market makers. 1.1660 is also the EURUSD mid-range and a multi-month composite point of control (POC).
That combination makes the 1.1660 region one to target if we get the breakout, which bulls have yet to confirm.
EURUSD 1.1660 most likely aligns with the DXY retesting the 98.90 confluence of support.
Alternatively, the EURUSD would have to break below the 1.1540 lows, and really the November open at 1.1528 to suggest a shift in market structure.
As for the DXY, bulls would have to take out the 99.75 November open to expose buy-side targets.
For now, I’m not convinced that’s the likely scenario based on Wednesday’s price action. It will come down to market structure, which remains indecisive as of this writing.
