Strategies Technical Analysis Trading Tips

Technical Outlook: EURO FX Futures (6E)

  • The daily trend is still bearish
  • Price consolidating around the $1 level
  • Range-bound trading opportunities on the 2-Hour Chart


Because of the worse-than-expected CPI data and a strong Dollar, we can take advantage of many potentially good trades available in the markets currently. The fear of an economic crash in Europe is rising due to the Ukraine/Russia conflict and high inflation. If we take into consideration the Dollar that is strengthening, we can anticipate that the Euro may continue to experience lower prices.

Daily Chart

The strong downtrend we pointed out in our previous analysis is still intact. I applied two moving averages onto the chart, McGinley Dynamic moving averages which give great short signals as price retraces into the zone between the two.

The recent retracement we see on the daily was a great short signal; prices are still trading around the entry price of that trade, too, as the momentum indicator still trades negatively at -0,04720.
We can see countless times how the price pulls back into the moving average zone and then continues making lower lows.

Daily time frame Euro
Daily Chart

Consolidating around $1

The $1 level is proving to be of high attraction for the Euro, and rightly so. It’s a very powerful psychological level, as we’ve discussed here. So far, it is acting like a magnet pulling the price toward it from either side. $1 is a very important marker to watch for bears and bulls.

$1 level Euro Chart
$1 level Euro Chart

Range Bound Trading

Adding a stochastic and tweaking it to fit the current market conditions can be a great way to trade within a range. As the stochastic reaches over-bought, simply look for shorts while it’s in the upper zone and vice versa as it drops to the lower zone. As long as wide enough stop losses are used, and trades don’t get ‘choked.’

Look at the chart below; two trade examples show how we could profit from this pattern. We set wide stop-losses because of the high probability the setup has and just wait it out.

One of the biggest downfalls of traders today is that they have very little patience. Patience is key in trading and must be mastered.

2H Euro Chart