Swing zone between 1.24215 and 1.24459 held yesterday, but not today.
In today’s trading, this low swing zone was broken at the end of the Asian / early European session and this break led to a downside (see hourly chart below for pause and run) as buyers quickly turned to sellers.
The downtrend has now taken the price to another swing zone target around 1.2354. The low price just hit 1.23539 and is experiencing a rebound. The current price is trading at 1.23716 as I type.
Drilling up to the 5-minute chart, the pair broke below its 100 bar moving average during the Asian session, corrected to this MA, before cracking lower.
Consolidation against support near the 1.2354 level has now seen the 100 bar moving average (see blue line in chart below) catch up with price. This MA is currently at 1.23793.
Movement above – and staying above – is needed to give buyers some hope that the low (at least temporarily) is in place. A move above would target the 38.2% retracement of today’s decline at 1.2388 as well as the 50% at 1.2399. The falling 200 bar moving average to 1.24025 makes the 1.2400 area a key intraday level on greater bullish momentum.
In the absence of a breakout of the 100 bar MA on the 5 minute chart, the sellers remain firmly in control with a break out of the 1.2354 area as the next bearish hurdle.
Invest in yourself. See our forex education center.