The EURUSD reached the 50% of the move up from the 2000 low. This key target, is the midpoint of the move up from the post EURUSD introduction low (at 0.8225) to the 2008 high (see prior post: Forex technical analysis: EURUSD tests lower trend line ).
That level has been my target for the EURUSD and comes in at 1.2131. The low reached 1.21229.The pair also got close to the trend line low connecting the 2005 and 2010 lows at the 1.2105 level. Traders could not resist the temptation of buying between the two key levels. So they bought the pair against the levels (risk was still defined and limited after all and it is a big level) .
The 50% of the move up from 2000 low to the 2008 high was tested at 1.2131
The technical trade continued by spiking up to the 100 hour MA (see blue line in the chart below) at the 1.2186 level and stopping there (after all risk could be defined and limited there too).
EURUSD on an hourly chart
What now?
For me, the hitting of the 1.2131 level and subsequent bounce says, “be a dip buyer” . Looking at the 5 minute chart below, the 100 and 200 bar MA (blue and green lines) and the 50% of the days range at 1.21546, come in between 1.2150 and 1.21546. If the pair can stay above this area (stay above 1.2147 -it could be a risk defining level – either it is to hold or not), another test of the 100 hour MA could be in the cards. From there, it is up to the whims of what is a holiday market, to take it higher – with the topside hourly trend line at 1.2205 and the 200 hour MA (green line on the hourly chart at 1.2242 currently), the next targets (see hourly chart above).
5 minute chart of the EURUSD
