Hello Traders,
It is no secret that the Greenback has been on the receiving end of the resurgent Euro. Year to date, the euro has gained a massive 6.3% against the USD and all this was fuelled by the idea that the entire Eurozone has turned round that proverbial corner. With Le Pen Frexit ideas banished and Trump administration policy reforms shambolic, the Euro appreciated and as investors viewed the initial pro-dollar “Trump Trade” ideas as hot air and possibility of future resistance from congress a real impediment on how the much awaited tax reforms will be implemented. Furthermore, before the close of last week, the Eurozone Q1 growth rate was revised higher from 0.7% to 1.2% and this was above average growth since 2010, the average growth has been 1.1%. You can clearly see these developments from the weekly chart of this currency pair. The Euro has appreciated considerably buoyed by economic data streaming in and by the look of things, I think this is about it and a time for correction is underway.
My weekly charts points to an overextended and overvalued Euro and this is apparently across the board. In this time frame, last week’s candlestick closed as an inverted hammer and above the upper BB. With a 2.0 standard deviation in place, it means a chance of a major correction to bring equilibrium is underway mainly because of two confluence conditions. The inverted hammer head closing above the upper BB and the sell signal printed by the stochastics in the overbought territory. If you also paste a Fibonacci tool from last year’s Hi-Los, then this inverted hammer=selling pressure-is forming at the 23.6% level-which is significant statistically.
also take note of the overextended and undervalued USD Index in the weekly chart. it closed below the lower BB and do you think this is a coincidence? I think not. Load up the USD.
In light of this therefore, I will trade short and trade as follows:
Sell: 1.1160
Stop Loss: 1.1260
Take Profit: 1.08 and a break below that gap and support mean 1.03-1.05 is ideal.
Have a good trading day and let me know what you think.

eurusd daily chart-29.05.2017

Source: Dalmas Ngetich

eurusd weekly chart-29.05.2017

Source: Dalmas Ngetich

usdx weekly chart-29.05.2017

Source: Dalmas Ngetich

5 thoughts on “EURUSD DAILY ANALYSIS FOR 29.05.2017”

  1. Maryna says:

    Dalmas, EURUSD will be an interesting pair to watch as I see both you and William mentioning the 1.1160 area to either sell or buy. However, price came very close to this price today and looking at H4 stoch, wants to pull up, except that I will not enter a trade unless more participant’s enter the market as it’s a Public Holiday for many countries.

  2. Teboho Faro says:

    Hi Daniel what do you mean by BB?

    1. Dalmas Ngetich - FOREX.TODAY says:

      BB means Bollinger Band. The middle band is the 20 period upper band and the two others are the lower and upper Bollinger Band. I use this indicator with a 2.0 standard deviation to measure market volatility and over/under evaluation.

  3. Dalmas Ngetich - FOREX.TODAY says:

    Sorry*****The middle band is the 20 period moving average***

  4. Teboho Faro says:

    thanks for feedback man really appreciate it

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