EUR/USD Technical Analysis – April 16, 2024

EUR/USD Technical Analysis – April 16, 2024
EUR/USD Technical Analysis – April 16, 2024

In today’s technical analysis of the EUR/USD pair, we are examining the potential movements dictated by the current pivot point structure and other critical technical levels. This analysis is particularly important following the latest economic sentiment data from Europe and building permits report from the U.S., both of which could have a significant impact on the currency pair’s behavior.

Current Pivot Point and Resistance Levels

  • Daily Pivot Point: 1.06368
  • Resistance 1 (R1): 1.06532
  • Resistance 2 (R2): 1.06816
  • Resistance 3 (R3): 1.06980
  • Weekly High: 1.06651

Today’s pivot point at 1.06368 serves as the baseline for intraday trading dynamics. The immediate resistance level, R1 at 1.06532, and the weekly high at 1.06651 could act as key barriers to upward movements. If bullish momentum increases, potentially spurred by favorable U.S. economic data, the next targets are located at R2 and R3, which are set at 1.06816 and 1.06980 respectively.

Support Levels and Key Lows

  • Support 1 (S1): 1.06084
  • Support 2 (S2): 1.05920
  • Support 3 (S3): 1.05636
  • Weekly and Monthly Low: 1.06062

On the downside, the initial support at S1 (1.06084) is very close to the current weekly and monthly lows around 1.06062, suggesting a strong area of buying interest that might prevent further declines. If this level breaks under pressure, perhaps due to worsening sentiment or stronger USD, traders might look towards S2 and S3 as subsequent floors.

Yesterday’s Price Range

  • Yesterday’s High: 1.06651
  • Yesterday’s Low: 1.06203

Yesterday’s trading range shows that the price tested and was rejected from the weekly high at 1.06651, indicating that this level is a significant resistance. The low of 1.06203 could also provide some intraday support if a retest occurs.

Trading Strategy

Given the proximity of today’s pivot point to the recent lows, traders should monitor these levels for signs of either a rebound or a break. A conservative approach would involve waiting for the price to either breach yesterday’s high to confirm further bullish potential or drop below the weekly and monthly lows to confirm a bearish trend continuation.

Intraday traders could use the pivot point and the nearest support/resistance levels to fine-tune their entry and exit points, utilizing tight stops and dynamic targets to manage risk, especially in light of potential volatility from recent economic news.

Conclusion

Today’s technical setup for EUR/USD suggests a cautious approach, given the significant technical levels formed around current prices. Traders should stay alert to price actions at these key levels and adjust their strategies according to how the market absorbs and reacts to the latest economic data from both Europe and the U.S. As always, maintaining a robust risk management strategy is crucial in navigating the complexities of forex trading.

Trading our dreams into reality,
Mihai Paul Olteanu