FX.co ★ Technical analysis of EUR/USD for September 5, 2014

Overview:

• We use historical rates to determine future prices because history will probably repeat itself again. The EUR/USD has broken major support at the price of 1.3003 which represents the daily pivot point. Also, it should be noted that the minor resistance is calculated at 1.2968 (the red horizontal line) and it is now approaching it. Therefore, it will probably start downside movement at this area and recovery again. So, the market will indicate a bearish opportunity at level of 1.2968. It will a good sign to sell at this spot with the first target of 1.2919 in order to form the double bottom (the lowest price of yesterday), and continue towards 1.2870. On the other hand, if a break is at the level of 1.3003, then it will be a good location for placing stop loss at 1.3030.

Trading recommendations:

• According to previous events, the price has still been trapped between 1.3003 and 1.2920.
• Below the price of 1.2968, look for further downside with the 1.2919 and 1.2870 targets.
• Buy above the daily pivot point 1.3030 with the first target of 1.3064, it might resume to 1.3087.

Note:

• Use the time frame of M15 to determine the lower and the higher price of yesterday, because it's more precise.