The EURUSD moved below its 100 hour moving average on Friday. In the process, the pair moved back into the up and down trading range that confined the pair from around July 18 to August 10 when the pair broke higher (see red box in the chart above).
The failure on Friday to remain above the high of the up and down area led to the fall below its 100 hour moving average as well (blue line in the chart above).
In trading today a brief rally in the Asian session took the price back toward that 100 hour moving average where sellers leaned. The price fell below its 200 hour moving average currently at 1.0232 (green line in the chart above) and below the 38.2% retracement of the move up from the July 14 low. That level comes in at 1.02088.
The low price reached 1.0186 before bouncing - helped by the weaker Empire manufacturing data. However the move to the upside stalled well ahead of the resistance against the 200 hour moving average.
The current price trades at 1.01975. The short traders would surely love if the broken 38.2% retracement level at 1.02088 to hold resistance now, but ultimately, the 200 hour moving average at 1.02322 is the most important resistance target to stay below if the sellers are to remain in control.
On the downside, the 50% midpoint of the move up from the July 14 low comes in at 1.01597 and below that is a swing area between 1.0144 and 1.01509.
Sellers are more in control with the breaks of the hourly moving averages. However the price is mired near the middle of the old up and down trading range. The up and down price action within that trading range was choppy and sloppy. That could be the pattern going forward as well.
Watch the 200 hour moving average above as risk for sellers. Stay below is bearish. And on the downside the 50% will be eyed ahead of the lower swing areas (lower yellow areas in the chart above).
