Has EUR/USD resumed its upward trend?

May 12, 2016

The EUR/USD has finally ended a run of six consecutive down days. So, is it about to resume its recent upward trend? Well, this will depend to some degree on the outcome of the upcoming data releases from both the US and the Eurozone. From the US, the key numbers to watch this week include import prices and the weekly unemployment claims data, both due for release on Thursday, followed by retail sales, PPI and consumer sentiment on Friday. Friday will also be an important day for the euro because that is when we will have the German and Eurozone first quarter GDP estimates.

Ahead of the abovementioned data releases, the EUR/USD is displaying an interesting pattern on its daily chart. Yesterday, it found support at 1.1360/70, an area we highlighted in detail in the Live Trading Session webinar on Monday. As a reminder, this level marks the convergence of the 61.8% Fibonacci retracement of the most recent rally with a bullish trend line and the 21-day exponential moving average.

It is also likely that the sellers may have taken profit around 1.1360/70 given the conflux of so many technical indicators there. So this rally could be a combination of both profit-taking from the sellers and fresh buying interest from the bulls.

Whatever the cause, the world’s most heavily-traded FX pair has now moved above resistance and yesterday’s high at 1.1410. It has broken above the ‘prior day’s high’ for the first time in seven days. This development may trigger further follow-up technical momentum buying interest.

In the previous four occasions when the prior high was taken out following a run of consecutive daily losses had occurred, the EUR/USD went on to rise for the next 2-6 days. If this trend repeats itself again then the EUR/USD may well surpass the 1.15 handle and possibly rise towards the August 2015 high at 1.1710 next.

Indeed, the underlying trend is still bullish as indicated for example by the still-rising moving averages and the bullish trend line. The only significantly bearish technical indication to consider is last week’s potentially false breakout above 1.15, when the weekly chart formed a bearish-looking inverted hammer candlestick.

With that in mind, traders should treat the short-term potential resistance levels on the EUR/USD with a degree of caution (as the longer-term trend may have turned bearish once again), starting with the 1.1450-65 area – previous resistance and 38.2% Fibonacci retracement against the most recent high.

Publication source
FOREX.com information  FOREX.com reviews

February 17, 2017
Golds rally may falter
The gold price has racked up its 2nd straight day of gains today on the back of US dollar weakness and doubts over an interest rate hike next month from the US Federal Reserve...
February 16, 2017
Where is black gold heading?
The Euro is slowly going down and this is not brought on by the Eurozone situation. Instead, this is fueled by the U.S. Dollar. Yesterday, Janet Yellen gave a speech in the Senate Banking Committee emphasising the fact that it Is not quite right to use the wait-and-see stance regarding the interest rate hike...
February 14, 2017
Will France exit the euro?
The Euro has come under pressure late in the European session today, after analysts warned of the huge costs that France would face should they decide to ditch the European currency...

XM Rating
OctaFX Rating
Grand Capital Rating
Cms Trader Rating
OANDA Rating
Orbex Rating

365BinaryOption Rating
Migesco Rating
Binary Brokerz Rating
GTOptions Rating
Binary.com Rating
Banc De Binary Rating