EUR/USD Technical Highlights:

  • EUR/USD finds buyers after straight line move lower
  • Bounce at risk of failing in the week ahead

For the intermediate-term fundamental and technical outlook on EUR/USD, check out theDailyFX Quarterly Forecast.

Last week’s net result was relatively even for EUR/USD, even posting asmall reversal candle on the weekly time-frame, but nothing super convincing. Nevertheless, the euro could continue to recovery after the big slide its recently experienced.

However, the bounce, given the break of the April trend-line, and more importantly the 2017 high, appears at risk of stalling sooner rather than later and leading to another leg lower. Just ahead is the 200-day MA, but without any price levels in confluence we’ll have to wait and see how a touch of the MA will play out.

A rally up to the broken 2017 high and turn down would hold more appeal for refreshing short positions, as not only is this old support considered a new level of resistance, but the move off of last week’s low will have been sufficient enough to work off oversold conditions.

Going through a slump right now? (It happens to the best.) Check out these 4 concepts forBuilding Confidence in Trading.

EUR/USD Daily Chart (Bounce, then roll over?)

More Bounce Before More Selling?

Retail traders have demonstrated interesting behavior in EUR/USD as seen viaIGCS ClientSentiment.On such a large move lower, one would have expected traders to take the other side of the decline more aggressively, but at only 1.25 traders long for every 1 short, we aren’t seeing the same kind of shift you would expect. For example, we saw the ratio in GBP/USD swell to 2.5:1 during its recent slide.

Following a bounce in the euro, keep an eye whether this behavior changes on another move lower. If we see an aggressive adding of long exposure in sudden-fashion, from a crowd contrarian standpoint, it could add weight to the notion we will see another leg lower to support in the low-11700s down to 11554.

Helpful Resources for Forex Traders

Whether you are a new or experienced trader, we have several resources available to help you; indicator for trackingtrader sentiment, quarterlytrading forecasts, analytical and educationalwebinars held daily,trading guides to help you improve trading performance, and one specifically for those who arenew to forex.

---Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at@PaulRobinsonFX

Source https://www.dailyfx.com/forex/technical/article/fx_technical_weekly/2018/05/12/EURUSD-Weekly-Technical-Forecast-More-Bounce-Before-More-Selling-PRtech.html?DFXfeeds=forex:technical:article:fx_technical_weekly



Improve Your Trading Skills

forexforbeginners

"Simply a Must Read for Every Serious Forex Beginner"

Available at Amazon

Now also for Kindle 

get forex book