In this series we scale-back and take a look at the broader technical picture to gain a bit more perspective on where price is trading with respect to trend. Here are the key technical levels that matter on the weekly charts heading into the weekend.
EUR/USD Weekly Chart
Notes: EUR/USD broke below confluence slope support last month with the decline breaking below the yearly opening range lows at 1.1916. Price is now approaching confluence support around 1.1709/45 where the 38.2% retracement of the late-2016 advance converges on a parallel of the dominant slope extending of the November low (red). Ultimately the outlook remains weighted to the downside while below the yearly but IF Euro is going to rebound (at least in the short-term) this would be a good spot.
Bottom line: The immediate EUR/USD decline is at risk heading into the 1.17-handle. Initial resistance stands back at 1.1916 with a breach above the yearly open at 1.2005 needed to alleviate further downside pressure. That said, a break lower from here would target subsequent support objectives a 1.1616 where the 2016 high converges on the median-line. From a trading standpoint, this would be a good spot to reduce any short-exposure - we would need to see some convincing near-term price action before attempting a recovery play. Watch the weekly close.
EUR/USD IG Client Positioning
- A summary of IG Client Sentimentshows traders are net-long EURUSD- the ratio stands at +1.09 (52.2% of traders are long) – extremely weak bearishreading
- Retail has remained net-long since April 30