Market Overview Technical Analysis

Euro (6E) Futures: Technical Outlook Pending Fed Rate Decision

  • The Fed rate decision and press conference may heighten market volatility.
  • The bullish breach above the trend channel has not significantly changed market sentiment.
  • An analysis of the 1-hourly chart.

Fed Day

Today is a very big day for the markets as the Fed will announce its rate decision with expectations of a 75 basis point hike. The press conference that follows will likely increase price volatility, and it’s something all traders must be mindful of in the coming session.

Quick Recap

From the analysis we did on October 25th, there was a price range between $0.976 & $1.003 that we determined as an area to begin taking short positions. The price is still trading within that range; however, there was a bullish break above it which was also above the downward trend channel that has been so prevalent in the Euro this year. One stop loss has been hit with the wider, safer one, still holding strong.

This breach above the trend channel is the first since the channel was formed, and it could be exactly what the Euro needed before it potentially continues with the next leg lower. In fact, the Chart has not changed much besides the channel break, but the next move will depend on what the Fed says.

Bears looking to short now have a clear stop loss at $1.018 or higher and an achievable target of $0.966.

Daily 6E chart showing down trend channel and short area
Daily Chart Euro

1-Hourly Chart

I marked off a support/resistance zone that the shorter-term traders can keep an eye on. It’s between $0.9882 & 0.9932. The volume profile for that period is marking its point of control line at the pivot point line (in black @ $0.999). The trend line support on this time frame is also one to keep note of, which, if the price fell, would be around $0.985. That is also Support 1 on our pivot points.

1 hourly 6E chart showing support zone , pivot points and volume profile
1 hourly chart 6E