EUR-USD (retrace to 1.17530 theory) for FOREXCOM:EURUSD by marcosdaunte

The Euro is due for a retrace back to 1.17530, listed below are some reasons (in my opinion) why the Euro might fall to the United Stated Dollar and hit or over-exceed the price target.

1.) Europe has seen a rise in the Delta-variant case (and fears of another extended-lockdown loom over the general public.)

2.) Based off of current chart patterns, it is more likely to see a retrace back down to the fib. number 0.786 than any other retrace of the fib. retracement indicator.

3.) There are additional indicators that the U.S Dollar will continue to rise (at least for the next few days possibly weeks.) Some of these are:

-the DXY is coming off a dip finding support as it moves higher.

-the S&P and NASDAQ continue to rise.

-the current “child tax credits” being sent out in the U.S could see an even stronger dollar develop.

5.) The price of the Euro is more likely to find support at 1.17530, which is closer to the year-low of 1.17042.

6.) The current chart-patterns show that the Euro Is mid-way through a descending-channel (seen as the yellow lines.) An even more bearish pattern developing (shown as the yellow arching line within the descending-channel) is a rounding-top.

7.) The R.S.I indicator is showing an overall down-trend.

8.) A good support zone to base this trade off of is 1.19000-1.17530 (fib. retrace 0.618 and 0.786)

9.) There are some political factors that also lend to a more bearish down-trend for the Euro (some too extensive to list here.)

Additional Notes to consider: A good “rule of thumb” is sell-short when “charts” are making new lows. If price does re-trace back to (or slightly below) 1.17042 this could indicate a double-bottom developing (possibly a good time to buy.) This “double bottom” would also back up the conclusion that the R.S.I is going to continue moving down in the near-future (until the Bullish breakout confirming the double-bottom.) If a double-bottom does form, I would except it to be an Eve-and-Adam double-bottom (more likely since the Euro would slowly find support in an attempt to move further.) The E.C.B (European Central Bank ) is starting their “investigation” phase into the creation of the Digital Euro , the U.S is planning to release a “white paper” in September on the creations of a C.B.D.C ( Central Bank Digital Currency.) The E.U (European Union) is planning to cut carbon emissions by 55% within the next 10-years.

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*this should be seen strictly as a “Trading Journal” and not any kind of financial advice.

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