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Here’s an update on the setup’s I’m tracking into the start of the week. Find a detailed, in-depth review of both these setups and more in today’s Strategy Webinar.
We highlighted this setup earlier today as EURNZD was breaking down. Failure to hold above the 1.6545 confluence region along with a break below 70 in RSI highlight the risk for further weakness in the pair. Ultimately, the broader outlook remains constructive within this pitchfork formation off the 2016/2017 lows – but for now, the risk remains for a move lower while below today’s high.
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A closer look at price action sees the pair trading within an embedded ascending channel formation with price rebounding off channel support in early US trade. A near-term slope off the highs may be in play here but it’s too soon to tell. For now, I’ll favor selling rallies while below the weekly open at 1.6615 with a break lower targeting 1.6329 and the trendline confluence around 1.6265. A breach of the highs invalidates the reversal play with such a scenario targeting 1.6830.
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Ethereum prices are testing a critical support zone at 295-303- we highlighted this zone last week and while prices have probed lower, we have yet to see a daily close below this threshold. The focus remains on this key support region heading into the start of the month.
A closer look sees the pair consolidating below near-term trendline resistance- Look for a break of this consolidation range with a topside breach favored. The outlook remains unchanged into the start of the week. Click here to review the latest Ethereum update including the intraday targets.
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—Written by Michael Boutros, Currency Strategist with DailyFX