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A potential scenario for EURUSD

Thursday, January 17, 2019 12:27 PM GMT

Today’s agenda includes major news such as US Philadelphia Fed Manufacturing Survey (Previous: 9.1, Forecast: 10.0), US Building Permits (Previous: 1.328M), US Housing Starts (Previous: 1.256M, Forecast: 1.250M), US Continuing Jobless Claims (Previous: 1.722M, Forecast: 1.735M) and Initial Jobless Claims (Previous: 216K, Forecast: 220K). On the other side, earlier in the day, EU annualized Consumer Price Index remained the same at 1.6%.

Reviewing the daily technical aspect, EURUSD retraced back according to our analysis a week ago. Further to this, the price can maybe continue lower towards the trendline (T1). Going to more technicals, RSI is within the 40 to 50 zone, which is supposed to act supportively during an uptrend (since middle of November). Also, Stochastics is oversold.

Daily

Heading to H4 timeframe, RSI hit the oversold zone and currently is moving upwards, while Stochastics has already formed a positive divergence. Lastly, CCI was highly oversold (less than -220) and has currently broken the -100 level, which is supposed to act as a bullish indication.

H4

Overall, the setup indicates a potential reversal, if the price approaches the trendline (T1), which is in confluence with the Daily (S3).

On The other hand, if price violates the trendline (T1) to the downside, then the scenario is busted.

Always review your own analysis. If there is a confluence between the current study and your own strategy, then you may have even better trading setups.

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