Nick Nasad
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Follow-Up EUR/USD: Top Picking Works Out for a 200 Pip Downswing

Back on Monday, I wrote about possible picking a top in the EUR/USD from a daily time-frame, with important support at 1.32 (click that link for the chart). It's always tricky to call tops, and even I expected perhaps one more push higher from which to sell, but the technical analysis and levels I laid worked out well enough.

In this updated image we see that we have had a fairly strong 3-session downswing and we now test the pivot at 1.3195/85 area. What's next then?

Well, if we have a break through this level, our next zone of support will be the 200 moving average (I have both the SMA, in black, and EMA, in gray,  in my charts). Beyond that we have some other upward sloping support trendlines, though those are a bit more subjective. And finally there's the 1.28 handle and 1.2760 support line.

We would need some serious disappointing news form Europe, a more dovish ECB, a flight to the USD because of war fears or a faster tapering timeline to prove as low as 1.28, but as we referenced in the original article, the consensus among traders and analysts is a price of 1.27 by years end.

Now, if the current pivot holds, then we are likely going to establish a bit of a trading range with resistance near 1.34. A push higher now seems a bit unlikely, but we'll have to monitor price action and developments as we start next week for further clues.

- Nick