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Forex Strategy: EUR/USD Reversal Plays Out Post Hammer Formation

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Talking Points

EUR/USD is once again flirting with the psychologically significant 1.3700 figure in intraday trade. The pair’s recovery during the US session overnight was signaled by a bullish reversal Hammer candle formation on the hourly chart as noted in the most recent candlesticks report.

While some of the recent gains have been eroded in Asian trading there is an absence of a bearish candlestick formation which obfuscates a bearish bias for the common currency. A close below the 1.3700 mark may open up further declines towards buying support at 1.3650.

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Hourly Chart – Created Using FXCM Marketscope 2.0

— Written by David de Ferranti, Market Analyst, FXCM

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