Forex technical analysis: EURUSD surges on optimism. What are the charts saying?
The EURUSD has trended higher in trading today and has pushed above the 1.12000 level in the process. The optimism on a Greek deal, is spurring on the buying. You can of course read all about it on Forexlive.com courtesy of Mike (flying solo) and Eamonn as well.
Technically, the pair is on the second leg of the trend move. The first move higher took the price up to 1.1132. The correction came to the 1.10775 which was right at the 38.2% of the move up from the low yesterday.
The second leg of the trend has take the price up to 1.1215. In the process the trend move was accelerated as the price moved above the higher channel trend line (see green circles). Traders will now be eyeing that broken trend line as close support. There is also a lower trend line that intersects that line at the 1.1171 area. If the price can hold this area, it will keep the buyers in control. Other support on a trend move comes in at the 38.2-50% of the last leg higher. The higher yellow area at the 1.1146-65 is where that area comes in. If the sellers are to take back control, they will need to get the price below this area.
ON the topside. the 1.12367 is the 61.8% of the move down from the June high. This is also near the highs from June 24 and June 30 at the 1.1234 and 1.1243 levels respectively. The 1.1277 level was the blow off high after the Greeks called the referendum and the market gapped lower before squeezing higher.