Technical analysis of EUR/USD for January 06, 2021

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Overview :

The EUR/USD pair will continue to rise from the level of 1.2289. The support is found at the level of 1.2289, which represents the 61.8% Fibonacci retracement level in the H1 time frame.

The price is likely to form a double bottom. Today, the major support is seen at 1.2289, while immediate resistance is seen at 1.2370.

Accordingly, the EUR/USD pair is showing signs of strength following a breakout of a high at 1.2335.

So, buy above the level of 1.2335 with the first target at 1.2370 in order to test the daily resistance 1 and move further to 1.2409.

Also, the level of 1.2409 is a good place to take profit because it will form a new double top.

Amid the previous events, the pair is still in an uptrend; for that we expect the EUR/USD pair to climb from 1.2289 to 1.2409 today.

However, in case a reversal takes place and the EUR/USD pair breaks through the support level of 1.2275, a further decline to 1.2215 can occur, which would indicate a bearish market.

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On the H4 chart :

The EUR/USD pair opened above the weekly pivot point (1.2263). It continued to move upwards from the level of 1.2263 to the top around 1.2345.

Today, the first resistance level is seen at 1.2370 followed by 1.2409, while daily support 1 is seen at 1.2237. Furthermore, the moving average (100) starts signaling a downward trend; therefore, the market is indicating a bullish opportunity above 1.2263.

Hence, it will be good to buy at 1.2263 with the first target of 1.2370. It will also call for an uptrend in order to continue towards 1.2409.

The strong daily support is seen at the 1.2263 level, which represents the double bottom on the H1 chart. According to the previous events, we expect the EUR/USD pair to trade between 1.2263 and 1.409 in coming hours.

The price area of 1.2263 remains a significant support zone. Consequently, the trend is still bullish as long as the level of 1.2263 is not broken.

On the contrary, in case a reversal takes place and the EUR/USD pair breaks through the support level of 1.2237, then a stop loss should be placed at 1.2130.

The material has been provided by InstaForex Company - www.instaforex.com