EUR/USD Risk On Formed The Gap Over The Weekend

September 04, 2017 08:27

Rising tension between the North Korea and US led to safe haven vs risk flows into many currency pairs this weekend and the EUR/USD has formed a retail gap (blue rectangle) to the upside. Risk on is usually reflected on AUD, CAD, NZD and JPY pairs while the USD was defensive in the past. At this point the pair is capped below D H3/WH3 suggesting either a retrace or continuation. If the pair retraces to 1.1840-56 (88.6, trend line, L3, ATR pivot, retail gap) the gap will be closed and it could spike upside. 1h momentum or 4h close above 1.1900 is needed for a continuation towards 1.1930, 1.1967 and retest of 1.2000. Adding to a possible bullish bias is lower than expected NFP with Average Hourly earnings data that were released on Friday.

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W L3 - Weekly Camarilla Pivot (Weekly Interim Support)

W H3 - Weekly Camarilla Pivot (Weekly Interim Resistance)

W H4 - Weekly Camarilla Pivot (Strong Weekly Resistance)

D H4 - Daily Camarilla Pivot (Very Strong Daily Resistance)

D L3 – Daily Camarilla Pivot (Daily Support)

D L4 – Daily H4 Camarilla (Very Strong Daily Support)

POC - Point Of Confluence (The zone where we expect price to react aka entry zone)

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