Technical Analysis EUR/USD for February 11, 2016

The EUR/USD closed nearly unchanged after probing lower levels ahead of the Fed Chair Yellen’s bi-annual testimony in front of Congress. While Yellen stuck to her guns on the gradual pace of tightening and data-dependency, she also elevated financial conditions and foreign economic developments as impediments to growth. Her review of GDP growth was somber, and the Fed’s balance of risk was still missing in action. The chilly outlook for inflation and inflation expectations remains troublesome, though the labor market situation has improved.

Support on the currency pair remains near the 10-day moving average at 1.1079, while resistance is seen near the October 2015 highs at 1.1495. Momentum remains positive with the MACD printing in the black with an upward sloping trajectory. The only caveat is that the RSI (relative strength index) is printing a reading of 71, which is above the overbought trigger level of 70, which could foreshadow a correction.