EUR/USD Mid-Session Technical Analysis for October 3, 2019

The Euro is trading slightly lower against the U.S. Dollar as investors await fresh data on the state of the U.S. economy. The key report today is ISM Non-Manufacturing PMI for September at 14:00 GMT. Earlier in the week, the ISM Manufacturing PMI report came in well below expectations, fanning the flames of recession.

At 12:06 GMT, the EUR/USD is trading 1.0952, down 0.0007 or -0.06%.

In other news that could have an effect on the Euro Zone economy, the White House said it plans to widen its combative trade policy with 10% tariffs on European-made Airbus planes and 25% duties on French wine, Scotch and Irish whiskies, along with cheese from across the continent.

According to CNBC, “the move comes after the World Trade Organization (WTO) ruled in favor of the tariffs after years of wrangling over European government subsidies for aircraft maker Airbus. The EU has suggested it will retaliate against U.S. tariffs.”

Other reports include weekly unemployment claims and factory orders. The ISM services report is expected to come in at 55.1, down from 56.4. Weak data is likely to drive the EUR/USD higher.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum has been trending higher since the formation of the closing price reversal bottom on Tuesday at 1.0879.

The main trend will change to up on a trade through 1.1110. A move through 1.0879 will negate the closing price reversal bottom and signal a resumption of the downtrend.

A closing price reversal bottom often triggers the start of a 2 to 3 day counter-trend rally. Its objective is the 50% to 61.8% retracement zone at 1.0995 to 1.1022.

Daily Technical Forecast

Based on the early price action and the current price at 1.0952, the direction of the EUR/USD is likely to be determined by trader reaction to the uptrending Gann angle at 1.0959 and the downtrending Gann angle at 1.0970.

Bearish Scenario

A sustained move under 1.0959 will indicate the presence of sellers. This could trigger a pullback into the next uptrending Gann angle at 1.0919. Look for a technical bounce on the first test of this level. If it fails then look for the selling to extend into 1.0899. This is the last potential support angle before the 1.0879 main bottom.

Bullish Scenario

A sustained move over 1.0970 will signal the presence of buyers. If this move creates enough upside momentum then look for the buying to extend into the 50% level at 1.0995. This is a potential trigger point for an acceleration into the resistance cluster at 1.1022 to 1.1024.