EUR/USD path of least resistance is down one day before the ECB – Confluence Detector
EUR/USD is trading below 1.11, struggling to recover despite a relatively calm upbeat market mood and ahead of the European Central Bank's decision.
The Technical Confluences Indicator is showing that euro/dollar is capped at 1.1196, which is the convergence of the Bollinger Band 1h-Middle, the Fibonacci 61.8% one-month, and the Fibonacci 23.6% one-day.
It is followed by several clusters of technical levels with the most substantial one awaiting at 1.1154, which is where the Pivot Point one-week Resistance 1 and the Fibonacci 38.2% one-month meet up.
Support awaits at 1.1068, which is the confluence of the Bollinger Band one-day Lower, the PP one-day Support 2, and the PP one-month S1.
The next noteworthy cushion is at 1.1005, and it is weak – the previous month's low.
Overall, resistance lines are stronger than support ones, indicating that the downside is more appealing.
Here is how it looks on the tool:
The Confluence Detector finds exciting opportunities using Technical Confluences. The TC is a tool to locate and point out those price levels where there is a congestion of indicators, moving averages, Fibonacci levels, Pivot Points, etc. Knowing where these congestion points are located is very useful for the trader, and can be used as a basis for different strategies.
This tool assigns a certain amount of “weight” to each indicator, and this “weight” can influence adjacents price levels. These weightings mean that one price level without any indicator or moving average but under the influence of two “strongly weighted” levels accumulate more resistance than their neighbors. In these cases, the tool signals resistance in apparently empty areas.
Learn more about Technical Confluence