EUR/USD 4H Chart: Channel up

Source: Dukascopy Bank SA
© Dukascopy Bank SA
EUR/USD has failed to stay inside the bounds of an ascending channel pattern it had been forming since the beginning of July. The pair plunged more than one percent over the last trading session, but is yet to break support at 1.1180 where August 16 lows lie. There is reason to believe that the rate will continue its way south to test August 15 lows at 1.1155 and 1.1135 after that. On a bigger time-frame, however, very strong support and resistance has been formed at 1.0502 and 1.1465 respectively. The pair has been bouncing in between these lines since the beginning of 2015; therefore, taking into account reduced volatility in year 2016, it is quite unlikely that any of these lines are going to be broken during this year. The aggregate technical indicator gives mixed signals through different time-frames, not allowing to exclude the possibility of an upward movement as well. In case the rate does recover, resistances at the weekly PP (1.1245) and 55-period SMA (1.1289) will be the first targets.
© Dukascopy Bank SA
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