EUR/USD Mid-Session Analysis for September 4, 2012 The EUR/USD is trading lower at the mid-session after an attempt to breakout to the upside failed to materialize. Today’s rally to 1.2626 fell short of last week’s high at 1.2634. Technically, the market has not actually formed even a minor top since it has been trading inside the wide range created on August 31. Typically, a series of inside days means impending volatility. Much of today’s break is being caused by a stronger U.S. Dollar rather than a weaker Euro. Today is a “risk- off” day as sentiment has shifted to the side of the safety. Trading volume continues to be lower than average due to this week’s European Central Bank meeting on September 6 and a U.S. Non-Farm Payroll’s report on September 7. Daily EUR/USD Chart The low volume has also helped form a short-term range between 1.2465 and 1.2634. This range has created a mid-point or pivot at 1.2550. This price should act as both support and resistance if traders decide to hold the Euro/U.S. Dollar in a range until there is some clarity. The swing chart indicates that the main trend is up despite the sideways trade. A move through 1.2634 will reaffirm the uptrend and could mean a challenge of a former top at 1.2692, followed by 1.2747. On the downside, the main trend changes to down on a trade through the last swing bottom at 1.2465. An uptrending Gann angle at 1.2515 today should be considered a possible downside target. This angle has been providing both magnitude and direction since the bottom at 1.2255 was formed on August 16 so its failure to hold on a test could trigger the start of a sharp break. A downtrending Gann angle at 1.2607 could become resistance if the EUR/USD closes under this price today. Otherwise, it has been acting as a pivot over the past three days. A close over this angle will be bullish.