Trading Forex and CFDs is risky
Read HotForex Daily Market Analysis

EURUSD at correction after 1.1880 High earlier?

Market Analysis

EURUSD, H1 and H4

The dollar has continued to track lower, this time following the release of the minutes to the September FOMC meeting. While overall maintaining expectations for a 25 bp hike in the funds rate, the minutes weakened the conviction for this a tad, with some policymakers expressing concern that low inflation was not “transitory.” The narrow trade-weighted USD index has seen a low of 92.64, which is the lowest level seen since September 26.

Meanwhile, EURUSD lifted for a fifth consecutive session, logging a 17-day peak of 1.1880, and today is still continues moving above 1.1850 area, even if we are seeing a slight correction downwards for the last 3 hours. In the Daily chart, the pair formed 4 upwards consecutive Daily candles and manage to broke yesterday the 20-DAY MA. However has not still manage to get back in the upwards channel seen since April.  In a shorter time-frames such as the  4-hour candles , the pair still seems positive despite the correction seen earlier, since it did not manage to break the support trend line drawn  since Monday (immediate support in an hourly chart at 1.1850), while  Parabolic SAR remain positive and RSI is still above 70.

The 1-hour chart agrees once again with the wider picture of the pair, since it keeps moving above 20-period MA, by creating higher low/upper fractals. In the 1-hour chart the doji candle seen on London opening along with consolidation seen at the 20-period MA ( around 1.1860) suggested that bulls are still in the market and triggered Long Positions in both hourly and 4-hour time frames. Once EU industrial production came out higher than anticipated , an entry was taken at the new hourly opening, at 20-period MA, at 1.1861. Target was above the recent upper fractal, at 1.1885, while support was set at 1.1830,  which is a confluence of ATR (14) and below low Fractal.

In the 4-hour chart, Targets were set at 1.1910 ( Between 50.0-61.8 Fibbonacci since September’s peak)  and 1.1940, with support at the 200-period EMA, at 1.1820.

As mentioned, Eurozone industrial production higher than anticipated in August. Variations over the summer are partly due to the timing of school holidays, but the strong annual rate over both months ties in with the signals from survey data that show ongoing robust growth over the summer. More arguments then for the hawkish camp at the ECB, although with political risks and uncertainties still hanging over the union there doesn’t seem to be a majority in favor of a firm commitment to an end date for QE just yet.


Click here to access the HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! The next webinar will start in:

Andria Pichidi

Market Analyst


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.