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I’ve got a classic trend retracement setup on my radar for today!

Think EUR/USD is likely to bounce off its channel support?

Before moving on, ICYMI, I’ve listed the potential economic catalysts that you need to watch out for this week. Check them out before you place your first trades today!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

Australia’s MI inflation gauge rose from 0.5% to 0.8%

Australian job advertisements slowed from 10.9% gain to 0.4% uptick

Shanghai reports another record number of COVID-19 cases

China reports new variant of COVID-19 virus

 

Upcoming Potential Catalysts on the Forex Economic Calendar:

BOE Governor Bailey’s speech at 9:05 am GMT
BOE MPC member Cunliffe’s speech at 2:00 pm GMT
U.S. factory orders at 2:00 pm GMT
BOC business outlook survey at 2:30 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

What to Watch: EUR/USD

EUR/USD 1-hour Forex Chart

EUR/USD 1-hour Forex Chart

With no major reports on deck today, I’m looking at this simple technical setup on the hourly chart of EUR/USD.

Will the trend still be our friend?

The pair has been cruising inside a rising channel with its higher lows and higher highs for a month already. Another test of support seems to be underway, but the 61.8% Fibonacci retracement level is doing a fine job of keeping losses in check for now.

If support holds, EUR/USD could make its way back up to the swing high around the 1.1200 handle or the channel resistance. Stochastic has room to climb anyway, so the pair could follow suit while buyers have the upper hand.

Also, the 100 SMA is above the 200 SMA to confirm that the uptrend is likely to carry on. Plus, the 200 SMA lines up with the 61.8% Fib to add to its strength as a floor!

The dollar might take a breather from its recent rallies since last Friday’s NFP report turned out weaker than expected, dampening hopes of aggressive tightening moves from the Fed. However, if risk aversion extends its stay in the markets, the safe-haven dollar could continue to rake in gains.