EUR/USD Mid-Session Technical Analysis for December 21, 2016

The EUR/USD is trading slightly higher at the mid-session. Volume is expected to be below average due to the holiday trade. However, the market may be susceptible to volatility spikes. The volume is so light that a headline could move the market.

Technical Analysis

The main trend is down according to the daily swing chart. The main trend will turn up on a trade through the 1.0670 main top. A trade through 1.0352 will signal a resumption of the downtrend.

Earlier today, the upside price action helped make 1.0352 a new minor bottom.

The short-term range is 1.0670 to 1.0352. Its 50% level or pivot is the first key upside target at 1.0511.

The main range is 1.0872 to 1.0352. Its 50% level or pivot comes in at 1.0612.

Forecast

Based on the current price at 1.0406 and the earlier price action, it appears the direction of the Euro today will be determined by trader reaction to 1.0389.

A sustained move over 1.0389 will signal the presence of buyers. This is followed by 1.0418. Taking out this price with conviction could trigger a further rally into a downtrending angle at 1.0470. This is followed by a resistance cluster at 1.0511 to 1.0512.

A sustained move under 1.0389 will indicate the presence of sellers. This could lead to a retest of yesterday’s low at 1.0352. This is followed by a steep downtrending angle at 1.0270.

Watch the price action and read the order flow at 1.0389. Trader reaction to this price will tell us if the buyers are gaining control.

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