200 hour MA, 100 day MA, trend line. All come together
As the NY trading day begins and traders await the US housing and builidng permits at 8:30 AM ET, the EURUSD is taking a back seat to the GBPUSD which has surged higher on the better than expected UK core CPI. In fact, as the GBPUSD soars, the EURUSD is trading down on the day.
That wander lower has the pair testing a key support area that is being defined by the 200 day MA at 1.10447, the 200 hour MA (green line in the chart above) at the 1.10469 (currently) and a lower trend line connecting the most recent lows at 1.1050. The low for the day has come in at 1.10508.
I would expect buyers to defend the level (risk can be defined and limited), with stops on a break below. A move below will next target 1.1030 and then 1.1013 – 21.
On the topside, the midpoint of the days trading range comes in at 1.1072. The broken 38.2% retracement of the move up from the August 5 low comes in at 1.1073. The close from yesterday was at 1.1074. So move back above this area will be eyed by buyers ( price needs to get and stay above this level). The low to high trading range for the day is only 43 pips. So there is room to roam on either side. The 100 hour moving average on the topside comes in at 1.1118 and this would be a target if support holds and the price heads higher.
