Morning Market Update – EUR/USD

The EUR/USD pair is still bounded in consolidation from the 1.1572 and intraday bias stays neutral. The pair breaking the 1.1596 resistance is needed to confirm completion of the decline from the 1.1572 level. The near-term outlook will stay bullish. The pair trading below the 1.1572 will target at the 1.1547 levels.

In the bigger picture, a further rise from the 1.1572 medium term level bottom is seen as a corrective move for the moment. Therefore, in case of another rally, we’d be cautious on retracement of the 1.15962 and then at 1.1634 levels to limit upside and bring reversal. Meanwhile, sustained trading below the 50 EMA will suggest that such medium term rebound is completed and could then bring retest of 1.1572 low.

The pair trading with such a strong momentum that continues to build and it had only seemed like a matter of time. However, the recent weakness of the dollar has helped to drive the break above the 1.1596 level. This had been the broad projection target from the old range breakout, so the target has been achieved. This means that the pair is trading at its support when it hit a high at the 1.15962 level, but also on the longer term charts is now testing the top of the trading range between the 1.15727 and 1.16342 levels. As yet there seems to be little reason not to believe that the Euro can continue to push higher, so buying into the intraday dips remains viable. The daily momentum indicators are all strongly configured. The four hourly chart shows support at the 1.1572 level.

The pair continues to rise by today’s opening and attempts to breach the resistance line located now at the 1.1596 level which hints the price and attempts to resume the main bullish trend again. The pair breaching the mentioned level followed by breaching the 1.1596 level will confirm opening the way to head towards the 1.1634 areas initially.

On the other hand, the markets are waiting the Non-monetary policy’s ECB meeting today, which might cause mixed trading for the pair. Thus, we prefer staying aside temporarily until we get a clearer signal for the next trend. We will get through breaching the 1.15962 resistance or breaking 1.1572 support levels, as breaking this support represents a negative factor that will push the price to reactivate the negative scenario that targets to test the 1.1547 level.

The pair’s expected trading range for today is between the 1.1572 support and 1.1634 resistance levels.

Expected trend for today: Bullish
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