Converged moving averages stall the fall on the first look
The EURUSD move down to a new session lows in the early New York session and in the process tested the converged 100 and 200 hour moving averages at 1.17915. The low just reached 1.1791 and bounced modestly.
The convergence of the two hourly moving averages (100 and 200 hour moving averages or blue and green lines) ahead of the FOMC decision confirms the uncertainty of the market for the next directional move.
Yesterday the buyers tried to push the pair higher and take full control. The high price extended above the up and down extreme seen over the last seven or eight days above 1.1830, and also extended above the 38.2% retracement of the move down from the June 25 high at 1.18366. However, momentum could not be sustained and the price rotated back to the downside.
In trading today, the old swing high from July 22 at 1.1830 stalled the rally in the London morning session. Sellers leaned and pushed the price back down toward the converged moving average levels.
Those moving averages will be the barometer for the market bias today and through the FOMC decision (and going forward close?).
For traders now, watch the 1.18019 to 1.18043 for close resistance.
There was a ceiling near that area on July 20, July 21 and July 22 before chopping above and below it on the ECB decision day last week. Admittedly this week, the price also chopped above and below the levels. However, on the move down today, support was initially stalled in that area. Stay below keeps the sellers more control intraday, with a break of the two moving averages increasing the bearish bias with the next target at 1.17809.
A move above the 1.1804 level and we could see further upside probing off of the moving averages.