EURUSD Analysis April 2017 (D,W)
Created on Saturday, 01 April 2017 23:24
Written by Austin Galt
Let’s update the EURUSD as we head into the French presidential election.
EURUSD DAILY CHART
A 5 point broadening low now looks to be in play after price marginally clipped the previous swing high, setting up a point 4 high. Now one final move into a point 5 low awaits us.
Old lows often act as resistance in the future and this point 4 high was bang on the horizontal line denoting the June 2016 low.
This point 4 high was also right around the 200 day moving average (black) which is a good area for price to turn back down, especially given the bearish formation combined with the 100 day moving average (red) which is below.
The RSI is very weak while the MACD is bearish.
EURUSD WEEKLY CHART
There is no change to the forecast in calling for one final low, a false break low, that busts the triple bottom currently in place before a large rally occurs.
The Bollinger Bands shows price trading above the upper band before a sharp reversal back down. I expect price to make its way to the lower band and push even lower.
The RSI may well set up another bullish divergence on a new price low.
The MACD indicator is still bullish but I favour that to change shortly.
As for the French election, Marie Le Pen, the anti-EU candidate remains a clear favourite to win the first round and then lose the second round to Emmanuel Macron. I like to play the outside in these types of events and we’ve done well with Trump and Brexit however I currently favour the predicted outcome.
However, there is still plenty of trading to occur before the second round in May and we can update things before then. My thinking is if price is still aro9und these levels without having made new lows by the time the second round occurs then perhaps le Pen can cause an upset. For the moment, Marie Le Pen winning the first round, which is expected, should see bias to the downside but nothing too dramatic.