EUR/USD Mid-Session Technical Analysis for February 9, 2021

The Euro is trading higher on Tuesday after hitting a one-week high earlier in the session as traders continue to shed the greenback on worries over its upside potential against the backdrop of massive monetary stimulus and expectations of another U.S. fiscal stimulus package.

After investors aggressively dumped the Euro on bets on a stronger, faster economic recovery in the United States, the signal currency reversed to the upside on Friday following a report that showed weaker-than-expected U.S. jobs growth in January.

At 13:38 GMT, the EUR/USD is trading 1.2091, up 0.0041 or +0.34%.

The EUR/USD is currently testing a key area on the daily chart that could determine the next near-term move in the Forex pair. Aggressive buyers are betting that massive U.S. fiscal stimulus coupled with continued ultra-easy Federal Reserve monetary policy will weaken the greenback against the Euro.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since the formation of a potentially bullish closing price reversal bottom last Friday.

A trade through 1.1952 will negate the closing price reversal bottom and signal a resumption of the downtrend. The main trend will change to up on a move through 1.2190.

The main range is 1.1800 to 1.2349. The EUR/USD is currently trading on the strong side of its retracement zone at 1.2074 to 1.2010.

The short-term range is 1.2190 to 1.1952. The EUR/USD is currently straddling its retracement zone at 1.2071 to 1.2099.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD into the close on Tuesday is likely to be determined by trader reaction to the short-term Fibonacci level at 1.2099.

Bullish Scenario

A sustained move over 1.2099 will indicate the presence of buyers. If this generates enough upside momentum then look for a test of the next main top at 1.2190 over the near-term.

Bearish Scenario

A sustained move under 1.2099 will signal the presence of sellers. The first downside target is a potential support cluster at 1.2074 to 1.2071.

If 1.2071 fails as support then look for a potential acceleration to the downside with 1.2010 the next key target.