EUR/USD: Watch For Counter-Trend Confluence
The EUR/USD is patiently waiting for major economic data coming in this week. We have some real high impact info this week and we could see risk-off sentiment possibly coming back. We need to watch out for upcoming releases:
Any bad US data during the week, including bad CNY data, could cause a risk off. If OPEC fails to cut oil and oil price drops subsequently, it won’t be good for USD. End of month positions may reverse too on profit taking.
In addition to fundamentals, technical chart is also showing signs of a possible counter-trend movement, as we could see that weekly support is there – X cross on weekly chart formed by historical buyers and lower equidistant channel support line.
On H4 time frame we can see the similar picture. L3 support is sitting at the bottom of equidistant support and we can see a regular bullish pergence.
While above 1.1085-70, EUR/USD might turn bullish, targeting 1.1200 and 1.1240.
So it is very important that we pay attention to price flow, as the EUR/USD is close to a counter-trend confluence POC.