FX.co ★ Weekly technical levels of EUR/USD for August 18-22, 2014

Weekly technical levels of the EUR/USD pair.

Trading recommendations:

• According to the previous events, the price of EUR/USD is going to move between the levels of 1.3366 and 1.3430. Buy above the level of 1.3381 which represents the weekly pivot point in H1 chart with the first target at 1.3413 in order to test the double top. Then, the trend will be able to continue toward the level of 1.3429. Also, it should be noted that the weekly resistance 1 coincides with the price of 1.3429. Notwithstanding, the stop loss should be set at 1.3350.
  

Review:

• R3 and S3 are considered to be clear indicators of the maximum range of extreme volatility, though it is possible to pass them through. Pivot lines work well on the sideways markets as prices are most likely to be located between the R1 and S1 lines. Within a strong trend, the price is expected to be lower than the pivot point line and continue moving. If the breaking news released may affect the market, the price is likely to go straight through R1 or S1 and even reach R2 and R3 or S2 and S3.
• If the trend is of an upside character, then the strength of the currency will be defined as follows: EUR is an uptrend and USD is a downtrend.
• Fibonacci retracement is used to determine accurate psychological levels of support and resistance.
• The period of time should be taken into account. Fibonacci is in a range trade; it looks like the trend is trapped and going up or down.
• If you sell or buy for a long term in this period, you will surely lose your profit.