EUR/USD Triple-Topped

The EUR/USD is one of those instruments that have been recently locked in a range amidst global market uncertainty. There are a number of factors to this, however we would just stick to a couple we consider significant for this text:

A). Unperturbed USD Strength: The USDollar has been on a flight since April on the back of strong economic condition within the US economy; the Fed have increased their hike frequency as a result of this. This has driven capital flow into the US as a result, hence the USD strength. After an immense surge upwards, the USDollar did top on its bullish momentum as it was quite obvious that price supposedly reached an overbought level. A fresh momentum of bullishness is currently seen in the USDollar as new batch of capital flow into the US as investors see securities within the giant’s economy as safe-havens as trade war fundamentals escalates.

B). Options Expiry: There are options expiry levels and zones that have shown significance to price movement [see H1 Chart]. The most current at the 1.1600 – 1.1610 area.

Technically, the market has “triple-topped” indicating a possible risk to the downside [see H1 Chart]. Traders can look to sell this instrument on this basis, whilst factoring the option expiry at the 1.1600 price area – currently serving as support as this is being publish.

Fig 1: Hourly (H1) EUR/USD Chart

EUR/USD

Sell pending order @ 1.15975

Stop: 1.16460

Limit: 1.1550

Conversely, trade war risk can significantly and abruptly alter market sentiments. Traders are advised to always use a stop loss.

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