The battle lines are being drawn more clearly in the EURUSD. What would “break” the pair?

… and they are lines

If I were to look at the price action this week in the EURUSD, it has up and down fits of buying and selling, but there are some battle lines that are developing.

On the top, 

If you draw a trend line connecting highs, the swing highs from today stalled at the topside trend line.  

Although there was a break of the MA – and each failed quickly – the trend line is exerting an influence too. Traders can use that to their advantage. Stay below, more bearish. Move above and the bias would be more bullish. That trend line comes in at 1.2304 and is moving lower 

What about the downside?

At the low yesterday and today, the lows stalled in a well defined swing area.  

If you go back to mid-March, there are a number of swing levels in the 1.2251-602 area (see blue numbered circles). There are seven in this window including the lows from yesterday and today.  

Yes, back on March 20 and March 21, the price moved below on a way to the low at 1.22387, but after that failed, buyers reemerged and based against the area.   We can look at the break as a failed break. 

That area is key for an extension lower.  The price needs to get below that wide line (and stay below) for a more bearish technical picture.

Is there anything between the trend line above at 1.2304 and the swing area below at 1.2251-602?

In between the upper and lower extremes is a swing area defined by swing lows going back to March 22 (see red circles).  We are currently testing that interim level – looking for sellers. Today the area has been less cooperative, but when the market is ready to move, it can use the interim level as a clue for the strength of buyers/or sellers.  Be aware.

So although the price action in the EURUSD is somewhat choppy, there is some technical lines forming that should give traders some clues to the bias.  We will see if “the market” can make a run outside of the confined range in the next day or so.