The state of play.

With just over an hour to go until we get today's economic data dump in the form of European PMIs, I'll take the time now to publish some of my technical views on EUR/USD.

Now I'm big on clean charts with good solid higher time frame levels. If price holds that particular support/resistance zone, then I see that particular market as being in play and look to zoom into an intraday chart to look for entries which offer me the tightest risk:reward. Usually this means on short term pullbacks.

But first of all, lets start with the higher time frame look to see if there's a zone in play:

So check. After bouncing off that support zone, price has now come into resistance at the descending trend line.

We were speaking about this level on the ForexLive blog yesterday where we had this line drawn on the hourly:

This is what I mean when I say I look for short term pullbacks. So here we've got a higher time frame resistance level having held on the daily (the trend line) so from there it's all about looking for entries with the best risk:reward. Something that these pullbacks offer us.

From here, I'm looking for the stepping pattern to continue. Breaks of short term support levels being retested as resistance. You can already see a potential second step being created now.

Now let's see what the numbers do.