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EURUSD – Technical Analysis

  

US Federal Interest rate decision

The FOMC meets to determine where to set the interest rate. The short-term interest rate is a key indicator for traders as it impacts the value of the US dollar. 

Due to the FED’s current monetary policy to counteract the impact of the Covid-19 pandemic, interest rates have been kept low and are currently set at 0.25%.

If the interest rate is higher than forecast, it could be bullish for the USD. However, a lower-than-expected rate could be bearish for the USD.

The decision is expected on Wednesday, 28 July at 20:00 GMT+2

EURUSD Technical Analysis 

Indicator Analysis for the EUR/USD pair

Average true range ( ATR)

As of the time of writing this market analysis, the total volatility of the market is presently approaching its depth. If possible, this could result from the build-up formation that the market is experiencing on its daily time frame.

Relative strength index (RSI)

The RSI indicator hit an all-time high for this pair during the early January of 2021 at a recorded area of 70, which has been identified as the highest level the RSI indicator has gotten so far, the EUR/USD pair. Since the beginning of January 2021, the entire relative strength index of the market fails to cross above or below the average strength of 40.

EUR/USD Technical Analysis For The Daily Time Frame

Using the top-down multi time frame for technical analysis, followed by 4hr and 30min for trade execution in the daily time.

The currency pair was near the support area observed at 1.17021 on the daily time frame. Price was seen losing its bearish pressure and respecting the trendline. After a series of bearish pin bars was printed on the price chart following the completion of a succession of the bullish candle. Thus, this serves as an entry point for the buyers to go long in the market regarding the presence of the doji, and it’s also an indicator of price rejection above the price restriction zone. 

Therefore, the overall market conditions are seen on the bullish side following the formation of the doji candle in the subsequent trading day. 

However, the main technical analysis indicator that serves as the term in which a trading decision is made is based on the candlestick pattern notice on the price chart (i.e., the doji candle). And to further have profitable trades in the coming weeks, a critical observation must be placed on the recent price pattern and the fundamental news effects.

First resistance point is 1.18802

Second resistance point is 1.19700

Third resistance point 1.2135

First support point is 1.17597

Second support point is 1.17057

Third support point is 1.16113

This marked resistance and support levels should be used as an entry or exit point trading motive when approaching the market in the future market openings.

EUR/USD Technical Analysis For The 4-Hour Time Frame

In the 4hr time frame, the price was seen holding between support zone 1.17526-1.17603. Price broke the previous high, but we still need to wait for the price to make a higher low to buy a trading setup. If the price breaks below the mentioned support zone, then it shall be a potential sell signal. Waiting for the retest of the support level is something to keep in mind for a better risk-reward ratio.

Key Trading Recommendation 

Because the market has hit the rejection point on multiple intervals, the big market Shakers picture will be unclear as the market still seems not breaking the highest point and is in range. At the same time, the retail traders will also benefit from the big moves if the market should respond to the short-term bullish moves.


Vantage does not represent or warrant that the material provided here is accurate, current, or complete, and therefore should not be relied upon as such. The information provided here, whether from a third party or not, is not to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any financial instruments; or to participate in any specific trading strategy. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. We advise any readers of this content to seek their own advice. Without the approval of Vantage, reproduction or redistribution of this information is not permitted.

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