EUR/USD: Support At $1.06736 Needs To Hold
2022.06.06 10:51
Previous EUR/USD forecast talked about the price targeting $1.08300, which is close to the monthly triangle support line. But, the price could not break above the $1.07825 resistance level.
It reached the resistance at $1.07825 and returned to $1.06736, where it bounced back up. Eventually, it broke below the $1.06736 support level.
The break below was short-lasting because the price on Thursday returned above $1.06736 and closed the day above the previous week’s close price.
And on Friday, the price reached the supply zone at around $1.07825, where it was rejected. In the end, the pair closed the day below this week’s open price. That is a symbolic indication of where the price could move next week.
EUR/USD daily price chart.
Next week we could see a price close at around $1.06736. This is because the price closed the week below the previous week’s close price and this week’s open price.
Sellers around $1.07825 are pushing the price down, and it seems it has not been exhausted completely. $1.06736 is now a base for buyers, which they will defend, and it will be a base for future moves to the higher price.
As it looks now, $1.07825 is a strong resistance that will not be easy to break, but if the price stays close to that resistance, it will eventually break above it.
We have $1.05825 as the second support because the price has broken $1.06736 this week, which indicates a strength loss. So, if the price breaks below, we can expect the price to reach $1.05825.
We now have an uptrend channel support line that makes a confluence of support with $1.05825 support, so the price will have a hard time breaking below.
The price needs to break above $1.07825 to reach the previous week’s target, $1.08300, which is a confluence of resistance with the monthly triangle support line.
That is why the price will have a hard time reaching that target, and there is a strong supply that will push the price down each time it comes close.
We now have $1.06736 as support which will decide the next move. If it holds next week without breaking below, it will be a base for future moves up, and we will see a price trying to break above $1.07825.
If it fails as support, $1.05825 is the next support.
