EURUSD unable to break through key resistance level
Euro/US Dollar (EURUSD) Technical Analysis Report for Feb 08, 2019 | by Techniquant Editorial Team
Moving lower for the 5th day in a row, EURUSD finished the week -1.17% lower at 1.1322 after losing 17 pips (-0.15%) today on low volume. Trading 11 pips higher after the open, the Euro was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Thursday's low at 1.1324, the Fiber confirmed its breakout through the previous session low after trading up to 3 pips below it intraday.
Daily Candlestick Chart (EURUSD as at Feb 08, 2019):
Friday's trading range has been 30 pips (0.26%), that's below the last trading month's daily average range of 57 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EURUSD.
Two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns. The last time a Bearish Short Candle showed up on Tuesday, EURUSD lost -0.37% on the following trading day.
Prices are trading close to the key technical support level at 1.1302 (S1). Unable to break through the key technical resistance level at 1.1343 (R1), the pair closed below it after spiking up to 1.1351 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. After having been unable to move lower than 1.1324 in the prior session, the market found buyers again around the same price level today at 1.1321.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
With prices trading close to this year's low at 1.1289, downside momentum might speed up should the forex pair break out to new lows for the year. Trading close to December's low at 1.1270 we could see further downside momentum if potential sell stops at the level get activated.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for EUR/USD. Out of 501 times, EURUSD closed lower 54.89% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 51.70% with an average market move of -0.02%.
With six out of the other six Major FX Pairs closing lower today, the ones that stand out on the negative side are USDCAD losing -0.23% and AUDUSD closing -0.21% lower. None of the markets managed to end the day in the green. Looking at the Minor FX Pairs and Crosses, the winners of the day have been USDTHB surging 0.72% and USDNOK closing 0.5% higher. The worst performers of the day have been EURTRY tanking -0.64% and AUDCHF closing -0.42% lower. Read more