EUR/USD is trying to bounce back towards the 1.1330 resistance area after testing successfully the Ichimoku cloud support. With the Fed’s rate decision set for tomorrow every scenario is open. Traders should better stay neutral and wait for price to reach or break important levels.
Blue lines – trading range boundaries
EUR/USD was rejected earlier this week at the 38% Fibonacci retracement. The price had moved back and today it touched the Ichimoku cloud support in the 4-hour chart. With prices bouncing higher back towards 1.13 now traders should be very cautious approaching the Fed’s rate decision. Important levels are the 61.8% Fibonacci retracement and a low of 1.1085 reached in September.
Blue lines – bullish channel
EUR/USD continues to trade inside the upward sloping blue channel and above the Ichimoku cloud. As long as the price is above the Ichimoku cloud and inside the blue trend lines we should mainly be focused on the upside. Breaking below 1.1085 will be a big bearish sign for what to come. Of course the Fed rate decision tomorrow will play its role. My most probable scenario is to see a bounce towards 1.14 and then bearish reversal and eventually breaking below 1.10 and moving towards 1.07.
The material has been provided by InstaForex Company – www.instaforex.com