EURUSD trades to a new week low

Technical Analysis

Author: Greg Michalowski | eurusd

Below the Tuesday low at 1.11038

The EURUSD is trading to a new week low at 1.10973 and trade just off that level as I type. the Tuesday low at 1.11038 was the prior low.  The EURUSD got a shove lower after running away from the 100 hour MA (at 1.11362), the 200 day MA (at 1.1133), and the 200 hour MA (green line at 1.11299 currently). An upward sloping trend line was also busted and helped to shift the buyers to sellers.   

Below the Tuesday low at 1.11038

On more downside, the pair is looking toward a lower channel trend line on the hourly at 1.1090.  A move below that and the low from last week at 1.10843 will be eyed.  

Of note is that there is $1.6B of option settles at 1.1100 at the 10 AM ET cut off. Option sellers reap all the decay when the option settles at the strike price (so at 1.1100). That is the best case scenario. Option buyers want to see the price move away from that strike price.    That dynamic may lead to an impact on the currency pair (on hedging activity).  Nothing is guaranteed of course but there may be a magnate that keeps the price near this level into the 10 PM option cut off if the sellers are more in control.  However, if the price starts to move away, those option sellers may be forced to hedge their exposure into the settle.  

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