The bears tested the level of support but failed to break through it. So, at the moment, the pair is trading in the sideways channel. The level of resistance is also strong, and the pair returns to the flat channel everytime it tries to break through it. Overall, the downtrend prevails on the pair. The bears are steadily pushing the price to the downside and the bulls are unable to resist. The bulls hasn’t gained such a strong momentum yet.
Let’s check the technical picture on the EUR/USD chart.
For the pair to continue its downtrend, it will need to break through the support level of 1.1261 and settle below it. In case the bulls assert their strength, the pair will bounce back and move up to the resistance at 1.1289. On a strong momentum, the price may advance even higher and will begin the uptrend. Otherwise, the pullback is possible. Then the price is likely to stay hovering in the flat channel for a while.
It is better to open long deals within the major trend.
It's also worth placing positions after the price breaks through the support or when it hits the upper boundary of the flat.
I wish you more profits and no losses!
EUR/USD steps back from one-week top, still above 200-bar SMA.
Monthly falling trend line becomes the key immediate upside barrier.
Ascending trend line from April 24 adds to the support.
EUR/USD retreats from 1.0996 to currently around 1.0972, down on 0.09% a day, during Wednesday’s Asian session. The pair’s recent pullback takes clues from nearly overbought RSI conditions, coupled with the proximity to important resistance.
That said, the pair can revisit 1.0900 support while 200-bar SMA near 1.0870 could restrict further downside.
If sellers refrain to respect 1.0870 rest-point, a month-old rising support line, at 1.0800 now, could grab the market attention.
On the upside, a sustained break above the falling trend line from May 01, currently near 1.0005, could set the tone for a fresh run-up that challenges a monthly top near 1.1020.
---------- Post added at 07:25 PM ---------- Previous post was at 07:23 PM ----------
FX Strategists at UOB Group noted the outlook on EUR/USD remains tilted to the positive side for the time being.
24-hour view: “The sudden strong surge in EUR that sent it soaring to an overnight high of 1.0995 came as a surprise. While upward momentum remains strong, overbought conditions suggest the rapid advance is likely to take a breather for now. In other words, EUR is expected to consolidate and trade between 1.0940 and 1.1000.”
Next 1-3 weeks: “EUR continues to trade in a choppy manner as it surged and recouped most of last week’s decline (1.0980, +0.54%). The advance is quickly approaching the top our expected 1.0800/1.1000 range (overnight high of 1.0995) and upward momentum has ticked up. While the bias is tilted to the upside, EUR has to close above 1.1020 before a more sustained advance can be expected. In the meanwhile, the outlook for EUR is deemed as mildly positive as long as it does move below 1.0900 within these few days.”