FX.co ★ Analysis of EUR / USD Divergences for January 28th. Bearish divergence warns of retracement

4h

The currency pair EUR / USD, after the formation of the bullish divergence at the CCI indicator, performed a reversal in favor of the EU currency and the growth was above the correction level of 23.6% - 1.1358. As a result, on January 28, the pair growth process can be continued in the direction of the next Fibo level of 38.2% - 1.1446. Also today, a bearish divergence is brewing at the CCI indicator. Its formation will allow us to count on a turn in favor of the US currency and a slight decline towards the level of 23.6%. Rebounding quotes from the Fibo level of 38.2% will similarly work in favor of the beginning of a fall.

The Fibo grid is built on extremes from September 24, 2018, and November 12, 2018.

Daily

On the 24-hour chart, the currency pair rebounded from the correctional level of 127.2% - 1.1285, and this is the third bounce. For the Euro, this is a good signal. As a result, the growth process of quotations can be continued in the direction of the correction level of 100.0% - 1.1553. Fixing the pair below the Fibo level of 127.2% will work in favor of the American currency and increase the likelihood of a further fall in the direction of the correction level of 161.8% - 1.0941.

The Fibo grid is built on extremums from November 7, 2017, and February 16, 2018.

Recommendations to traders:

Purchases of the currency pair EUR / USD can be carried out now with the goal of 1.1446, as the pair completed the closing above the level of 23.6%, and a Stop Loss order under 1.1358, and hold the purchases until a bearish divergence.

Sales of the currency pair EUR / USD can be carried out with the target of 1.1358 with a Stop Loss order above the Fibo level of 38.2% if the pair bounces off the level of 1.1446 or a bearish divergence is formed.