Not a large trading range.
This time yesterday (it was red circle 8 in the chart below), I was speaking about the 1.1160-71 area. The price had waffled above and below the "yellow area" in the chart. That area was defined by a number of swing levels (red circles). At the time, the price action was showing support buyers against the area. That area held and the price moved higher (although the choppiness did continue). You can read it again HERE.
Fast forward to today, and that same "yellow area"came in play in the trading price action. The low for the day reached 1.11638. The buyers leaned against that support area (Red circle 9 - that is a lot), and the price eventually broke higher and away from the 100 and 200 hour MAs in the process (blue and green lines).
The lesson....if you can find an area "the market" is paying attention to, use it. The risk is defined and limited and it can set you up with great location on your trade entries. Also, don't be afraid to go back in the technical section of ForexLive and see what was written last. Sometimes a picture (chart) says a thousand words (or highlights - in optic yellow too).
What next?
The break higher (and above the 100 and 200 hour MAs at 1.1180 and 1.1193 respectively) has the EURUSD reaching for the prior swing highs at 1.12339 and 1.12497 respectively. The high price today reached 1.12281 so far. Can we get there? Can we extend?
The range for the day is 64 pips. The average range is 76 over the last 22 days. There is some room to roam if the momentum can be maintained.
What don't I want to see if long?
Looking at the 5-minute chart below, the 50% of the trend move higher comes in at 1.11987. The 38.2% comes in at 1.12056. That area should be the risk area for longs. Stay above is more bullish. Move below is more bearish. The area (yellow in the chart below) dovetails nicely with the natural support at 1.1200 AND the quick high from yesterday (at 1.1204) as well.
Buyers overwhelmed sellers on the move higher today. That move is taking the price away from some technical levels including the 1.1160-71 and the 100 and 200 hour MAs. I have to listen to that price action. The upside has hurdles - let's face it, the price is also in a range at the tops - but there is room to roam if the buyers still love it (and stay above the support). Time will tell.
