EURUSD and the path to 1.15

EURUSD and the path to 1.15

Eurozone currency has very strong potential to start a new rally quite soon against the US dollar, where the pair EURUSD is going very close to break multi-resistance points on its path to a new high starting from 1.15.

Here are the resistance points:

  1. The critical downtrend which was created between Sep 2018 and Jun 2019. this trend line will wait for EURUSD at 1.1210
  2. 200 days moving average will wait for EURUSD at 1.12
  3. Close one day above 100 days moving average.

EURUSD Daily
EURUSD Daily

So, in this report, we are explaining how we are going to trade EURUSD for the long term:

There are many factors shows on EURUSD chart, all of them are strong signals for the new rally:

Head and Shoulders pattern on EURUSD daily chart;

So in case the pair break above 1.12 (200 SMA) then inverted head and shoulders will be activated to give the pair strong push to EURUSD toward 1.15 as a part of it is new high path.

U.S. Dollar Index

The U.S. Dollar Index (USDX, DXY, DX) is an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies. DXY consist of:

  • Euro (EUR), 57.6% weight
  • Japanese yen (JPY) 13.6% weight
  • Pound sterling (GBP), 11.9% weight
  • Canadian dollar (CAD), 9.1% weight
  • Swedish krona (SEK), 4.2% weight
  • Swiss franc (CHF) 3.6% weight

Because of 57.6 of DXY value is Euro, then the highest value to gain will be by Euro if DXY drop, so let’s have a look into DXY analysis:

DXY daily chart
DXY daily chart

From the chart above, there are 3 factors should be mentioned:

  • It seems like, US Dollar index is building impulse wave toward the is between 95.4 and 93.8.
  • Break below 200 SMA and 100 SMA.
  • But still can create 3 waves pull back from the current price and must fail below 98.4

So how we can trade on EURUSD based on all points above to hit the first target on the path to 1.15?

  1. First of all, buy EURUSD on 3,5 and 7 waves pull back, which means buy the pair on depth.
  2. While you can buy EURUSD if it closes one week above 1.1240
Ahmad Alsheikh Ali
Ahmad Alsheikh Ali
BorseClub Founder, Trading and Development Manger
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