Reading the technical story: EURUSD holds support. Works toward key resistance today.
Something had to give yesterday. What is the story today?
If you recall from yesterday, something had to give in the EURUSD (see post here). The pair was in a range. The range was getting more confined. The trend line on the downside gave way BUT the price had other support targets it needed to grind through including the rising 100 hour MA. That grind lower stalled at the 100 hour MA in trading today.
Why tell you?
As traders looking for the technical story, the 1.0706 up to the rising 100 hour MA tell the story. If the price cannot get through it, the sellers can turn to buyers. That is what we have seen. That is the story. It tells you buyers are still in control.
The pair has moved 93 pips so far. The 22- day average range is 74 pips. The pair is above it's average trading range. Are we trending or are we on borrowed time for the day?
The high today has reached 1.08119. Looking at the daily chart, the 1.18192 level is the 50% of the move down from the November election high. That is a key level for the bullish story to continue today.
In February, the price moved above that level and the 100 day MA on Feb 2nd and squeezed up to 1.0828. It closed back below that retracement and 100 day MA. FAILURE.
Today we have moved above a topside trend line at the 1.07947 level. That is close risk for bullish traders. BUT we need to get and stay above the 1.0819 and then 28 level, to get this story to become even more bullish. Other targets on a break include 1.08495 (low from October 2016) and 1.0872 (high from December 2016).
The technical story is written by what the traders do at key levels. Sometimes something gives and turns the story against the tide, but we as traders need to see how the chapters unfold. Yesterday trend line support gave way, but today, the key 100 hour MA held like a champ. That give a more bullish story line once again.
The story line is a bit extended as we head into key resistance. We may see some slowing against resistance that should solicit some profit taking, but on a break higher, look for stops with the buyers getting back in.