EUR/USD Rips to Resistance- Bulls Eye Breakout

EUR/USD Rips to Resistance- Bulls Eye Breakout

Euro Technical Price Outlook: EUR/USD Weekly Trade Levels

  • Euro updated technical trade levels & sentiment – Weekly Chart
  • EUR/USD surges into key resistance confluence – risk for inflection
  • Weekly support 1.1383, 1.1280s (key); resistance 1.1445/60, 1.1540s

Euro is ripping higher against the US Dollar this week with EUR/USD up nearly 0.6% ahead of the US close on Wednesday. The advance puts into focus a key technical resistance barrier just higher and the we’re looking for a reaction into the close of the week for guidance. These are the updated targets and invalidation levels that matter on the EUR/USD weekly price chart. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Euro technical setup and more.

Euro Price Chart – EUR/USD Weekly

Chart Prepared by Michael Boutros, Technical Strategist; EUR/USD on Tradingview

Notes: Euro plummeted into confluent channel support into the close of last year around the 1.618% Fibonacci extension of the 2021 decline at 1.1222 – the subsequent rebound is now probing confluent resistance at the 2019 yearly open / 23.6% retracement at 1.1445/60– look for a reaction there IF reached. A topside breach / weekly close above this threshold would expose subsequent resistance objectives the 1.618% extension of the December advance at 1.1540 backed by the 38.2% retracement at 1.1630. Weekly support rests with the yearly open 1.1383 and is backed by the December channel line (currently ~1.1280s)- losses should be limited to this region IF price is heading higher in the weeks ahead.

Bottom line: The Euro recovery is now approaching confluent resistance at 1.1445/60 and we’re looking for possible inflection into this zone. From a trading standpoint, a good region to reduce long-exposure / raise protective stops – look for support ahead of 1.1380s on pullbacks with a close higher needed to clear the way for a larger breakout towards 1.15 and beyond. I’ll publish an updated Euro Price Outlook once we get further clarity on the near-term EUR/USD technical trade levels.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Euro Trader Sentiment – EUR/USD Price Chart

Euro Trader Sentiment - EUR/USD Price Chart - Euro Retail Positioning - Technical Outlook

  • A summary of IG Client Sentiment shows traders are net-long EUR/USD – the ratio stands at +1.10 (52.38% of traders are long) – neutral reading
  • Long positions are3.77% lower than yesterday and 6.99% lower from last week
  • Short positions are15.41% higher than yesterday and 19.23% higher from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests EUR/USD prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current EUR/USD price trend may soon reverse higher despite the fact traders remain net-long.

Key Eurozone / US Data Releases

Key Eurozone / US Data Releases - EUR/USD Weekly Event Risk - Economic Calendar

Economic Calendarlatest economic developments and upcoming event risk.

Previous Weekly Technical Charts

— Written by Michael Boutros, Technical Strategist with DailyFX

Follow Michael on Twitter @MBForex

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Originally Posted on: https://www.dailyfx.com/forex/technical/home/analysis/eur-usd/2022/01/12/Euro-Price-Forecast-EUR-USD-Rips-to-Resistance–Bulls-Eye-Breakout-EURUSD-Technical-Outlook-MBTS1.html
By: Michael Boutros

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