Technical Analysis EURUSD Daily

1. Determine Speed, Direction and Momentum

Let's start by taking a look at the speed and direction of the EURUSD. We will be using the 21 and 55 Exponential Moving Averages to help us with this.

As you can see the moving averages have been "braiding" without clear direction and are currently crossing to the downside. The longer term trend shows a drop from June 2014 into a range in 2015 which we are currently testing the bottom of now after piercing it in December to January 2016.  

Let's take a look at momentum next to get an idea of the short term. For this we will be using the 5 ema and 8 sma. 

As you can see, momentum is strongly down over the past 10 days. The red (5 ema) is below the black and both are angled down. So we could say that the momentum is strongly pointing to the downside. 

2. Judge the longer term trend strength

For this we are going to use the 200 ma. 

From the end of December price pulled back to hit the 200 ma at the end of March. Price is currently below the 200 ma which is angled down telling us the downtrend is still in play. 

3. Is price vulnerable to reversal?

In contrast to the last statement regarding the downtrend we can see that price has been making higher lows and higher highs over the past 4 months and currently sitting on the trend line of those previous lows. This combined with the 21 and 55 ma's crossing suggests there is a good chance price will attempt another cross of the 200 ma if it bounces off this lower trend line. 

4. Volatility

For this we will use a set of Bollinger Bands (period 20, std dev 2)

The bands direction appears fairly flat following a squeeze around 20 days ago and price moving up to the top band and back down again. Price could easily find support now on the lower band. Volatility is increasing over the past 2 days as the upper and lower bands are starting to move in opposite directions and spread.  

5. Support, Resistance, Trendlines and Candle formations

The channel

Horizontal Support/Resistance Levels

The Triangle

The Range

Head and Shoulders, failing to find support on neckline (which would have confirmed a reversal)

6. Pivot Levels

Just taking a look at the monthly pivots here. If price continues to the downside then MS1 and MM1 look like good targets.

7. Potential Trades
If price breaks the bottom of the triangle and holds below then I will be looking at this Triangle breakout

Levels to watch

Even though my bias is to the downside, a strong reaction on the bottom channel trend line would lead me to look for opportunities trading up to the midpoint (fibo 50%)   

Anyway, that's it for now on the EURUSD. I hope you find it helpful.