EURUSD Levels To Look For Ahead Of Heavy Data Calendar

As I mentioned in our last FX Update yesterday, today and tomorrow will see a number of critical calendar risk events. As I did with USDJPY yesterday, I now provide a thorough EURUSD technical outlook with emphasis on the main technical formations and key levels to pay attention to ahead of these heavy risk events.

EURUSD technicals suggest bearish intra-week bias but ample support still awaits on downside

Today’s technical update will feature a twofold structure about what one can expect for the downside and conversely for the upside. At the time of writing this, we saw a spot reference of 1.3171 in EURUSD, leaving very important support/resistance levels intact, whereof breaks with a close below/above will help determine the intra-week direction.

EURUSD downside factors
With the inability of EURUSD to break through the 1.3400 level last week, despite multiple attempts and the subsequent closing below the 1.3295 support level, the short-term bearish sentiment has returned into this cross. But EURUSD still has some key support that needs to be taken out before the medium-term picture can turn negative from a broader technical perspective.

On a short-term horizon, we look for a close below 1.3135 which would mean that EURUSD has closed below the 1.3149 level, representing a 38 percent retracement in the 1.4940-1.2042 wave. This closing would also encompass the 200-day moving average, presently at 1.3143, which almost also coincides with the 100-day moving average at 1.3138. A close below the aforementioned support levels would give scope for a test of the 1.3100 support area and subsequently the 1.2993-1.3020 support zone. For a broader-based EURUSD technical downside call, a close below the 1.2745-50 base pattern zone is needed.

EURUSD upside dynamics
EURUSD was capped yesterday by the 23 percent retracement level of 1.3212 in the 1.3452-1.3138 wave. So a daily close above yesterday's highs at 1.3217 would suggest a more intra-week neutral stance on EURUSD. A break above 1.3217 would also open up the cross for a test of 1.3258 and potentially also 1.3300 before market close in New York on Friday. For a technical bullish bias to return to EURUSD, a close above the 1.3410 level is needed. Such a close would give scope for further upside acceleration and allow for a test of the 1.3452 level and further out to 1.3711, the high from 2013.

EURUSD on a 240 m scale

EURUSD on a daily scale