EURUSD – Weekly Outlook- February 22 2019

EURUSD – Technical Analysis for US Binary Options

Introduction

This is one currency pair among major currencies whose foreign exchange charts align with our top-down approach of technical price analysis, from consecutive bearish bars on a monthly chart to oscillatory time series on the 4hour and 2hour charts. Come along as we take you on a ride of the major fundamental and technical patterns that drives the pair.

Fundamentals

Euro News

ZEW Survey – Economic Sentiment Germany & the European Monetary Union

The Zentrum für Europäische Wirtschaftsforschung (ZEW) measures the sentiment of institutional investors by indicating the difference between optimistic investor shares and pessimistic analyst shares. An optimistic view is usually regarded as positive for the EUR, whereas a pessimistic view is recognized as negative.

For the European Monetary Union, the ZEW survey came out with an actual value of -16.6 which is greater than the -18.2 of the consensus and -18.9 of the previous result. The actual result for that of Germany was released -13.4, which is higher than both -14.0 and -15.0 of the consensus and actual respectively.

ECB President: Draghi’s Speech

Also coming up on Friday this week, Mario Draghi the ECB president will be giving a speech. His comments may hint on a positive or negative outlook of the Euro trend in the short-term. A hawkish outlook from him is interpreted as bullish for the EUR while a dovish is viewed negatively.

U.S News

US: FOMC Minutes 

This week Wednesday 20 ’19, the FOMC, a committee saddled with the responsibility of organizing 8 meetings in a year, thereby reviewing economic and financial conditions, and decides the appropriate stance of monetary policy, accessing risks to the long-term goals of price stability and sustainable economic increase. The FOMC Minutes are published by the Federal Reserve Board of Governors as a fair guide to the future US interest rate policy.

Technical

EURUSD: Monthly Chart

EURUSD analysis for US binary options - 22 february 2019

Following the trend direction from our previous post, we still maintain a bearish bias on the EURUSD pair from a monthly chart perspective. The bearish trend started from a breakdown of hidden bullish accumulation on 02 April ’18 and plummets further by a bearish accumulation on 01 January ’18. 

The bullish accumulation pattern triggered on 02 December last year revealed possible recovery of the bulls. However, the buildup of bearish accumulation pattern in the current month of February will confirm a continuation of the long term bearish trend.

EURUSD: Weekly Chart

Two weeks ago, we anticipated the failure of bullish accumulation from the perspective of the weekly chart. At the closing price of the week of 04 February ’19, the price closed below the bullish accumulation support of 1.13428 and the double bearish accumulation support of 1.13019 formed between 29 October and 25 November ’18.

These breakdown of critical support levels are early entry signals into a bullish hidden divergence setup, which further reinforce confidence to enter shorts.

EURUSD: Daily Chart

The above daily chart shows correction of the bearish price decline that started from the strong Bearish fakey pattern on 31 January ’19. We anticipate a continuation of the bearish trend in the event of a collision with the MA-65 which is currently at 1.1380. The chart shows critical resistance levels at 1.15144, 1.14355, and 1.14110. The critical support level is at 1.12342.

EURUSD: 4HR Chart

Making reference to the above 4hour chart, we’ll observe that it presented timely swing trading entry setups, beginning from the bearish accumulation pattern on 08 February ’19 18:00, a breakdown of double bullish accumulation on 13 February ’19 06:00, a bearish accumulation setup on 14 February ’19 18:00 and a bullish fakey pattern on 15 February ’19 16:00.

EURUSD: 2HR Chart

The 2hour chart presents a slightly different twist to the bullish and bearish swings as bullish divergence patterns are thrown in the mix on February 14 ’19 06:00 and February 15 ’19 16:00. A strong and timely pattern is the bearish fakey pattern triggered on February ’19 06:00. This is a high probability pattern that is best to initiate a trade on any major US binary options broker. On February 14 ’19 22:00 a bearish accumulation pattern follows a bearish engulfing. A bullish accumulation pattern ushered in an early entry signal for the bullish hidden divergence on February 15 ’19 16:00.

Conclusion

Although the fundamentals seem to support the EUR in the short term daily charts, in the long term, we envision a bearish trend following a buildup of bearish accumulation on the monthly charts, and failure of critical levels on the weekly chart.

 

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