Key Support/ Resistance Levels

Important Support/ Resistance

Key S/R Levels in the EUR/USD

Key Support/ Resistance Levels 

4-hour Euro Chart

Daily 20 SMA and Pivots

The Euro Dollar moved up to the 61.80 % fib extension (A-B at C). Today, market bounced back from this resistance level. The monthly pivot and daily 20 SMA (purple line) currently act as support. The low of January at 1.2624 (orange line) and the low of August 2010 at 1.2588 (purple line) are key Support and Resistance levels.

On the 4-hour chart (left) we see that the Euro respected the orange line and the 4-hour 10-SMA (red line). However, after the close of the bearish 4-hour candle at 12 a.m. (red circle-left) (Timing setup) the Euro fell below the orange line/ 10 SMA.

On the 1 hour chart (below) we see that the 12 a.m. hourly candle (A) respected the daily pivot at 1.2598. The 1 p.m. candle penetrated the pivot point and respected the weekly pivot at 1.2586 and the purple line (August 2010 low) but closed above the daily pivot on the hourly chart. However, the 3 p.m. hourly candle resumed the down trend and penetrated the already touched/ respected support levels (second test). The Euro found support at the monthly pivot point key level.

1 hour EurUsd key S/R levels

The price zone of the circled consolidation (blue) from Friday also provided some temporary support.

 On the 5 min chart (below) we had a kind of inverted Head and Shoulder in the Asian session with the green neckline and a prolonged left shoulder at the key support level of the low of January (orange line). At 11 a.m. we see a typical 3-wave consolidation at the support level (orange line) before the Euro resumed its downtrend. The duration of the consolidation is the same like the duration of the prior 5-min down swing. Most of the circled candles on the 5 min chart show how price bounced at key support/ resistance levels

5 min Euro US Dollar 

Breakout candle

Trading the Breakout

Unconfirmed Breakout candle

In the Asian Forex trading session

the Euro traded up to 1.2525 but then market started to move down sharply due to the market news about Spanish bond yields (see 5 min chart).

Daily Double Top pattern

5 min Market News Trading

hourly Timing Setup

From the chart technical perspective the Euro formed a bear flag at about 8 a.m. GMT on the 5 min chart before resuming its down trend.

The Euro breached the weekly S1 and the monthly low of March 2009 initially after the 8 a.m. hourly candle closed at this level (red circle) and the new hourly candle started (Breakout Timing for Trading; 9 a.m. market news).

The strong bearish 5 min "news" breakout candle at 9 a.m. triggered the market order stops below the recent lows, particularly the low of the 8th of June at 1.2435 (pink line) and the stops below the March 2009 support level at 1.2456, which held the market this week.

However, the breakout candle at 9 a.m did not get confirmed on the 5 min chart (no close of the succeeding candles below the range of the breakout candle).

 The Euro found support at the daily S2 and the 61.80 % Fibonacci Extension (A-B at C) on the daily chart (stop clearing below the recent lows accomplished- first test).

The 5 min candle at 9:15 a.m.breached the daily S2 but closed above it and also in the range of the prior breakout candle and the Euro started to consolidate around the 1.2435 level (pink line-June 8th).

On the 5 min chart we see that the Euro found resistance at the pink line before breaching it to the upside.

The Euro closed above the daily S1 at 12.15 but found resistance at the weekly S1 so that market fell back into the consolidation around the pink line.