EUR/USD - Short-term Correction Before Heading Lower?
After consolidating near the 1.1200 level for the past week or so, the EUR/USD made a pretty impulsive move to the upside yesterday and broke the downward sloping smaller trendline pulled from March 20 high. The 1.12000 level that was also a major short-term key resistance should now turn into key support if the price can sustainably stay above that level in the following days. The next resistance lies just above in the 1.12650-1.12500 zone which has acted as strong resistance at least 4 times before along with the 50 EMA on the daily chart that is currently at that level. However, the price is currently at 38.2 Fibo level which may give some short-term momentum and push the price immediately above that level - that, of course, seems to be a very bullish scenario. So, a pullback to the 1.12122 support is likely before any further move up. Nevertheless, April 15-17 highs at 1.13523 could be tested again should the Euro be able to maintain its momentum.
However, the overall picture is bearish, since we're still in a big downtrend. Once the price breaks above the 100 EMA on a daily chart around the 1.13070 level and finally the 200 EMA around 1.14158, the trend may change. So, it remains to be seen whether the price can revisit the April highs in that current correction movement. Until the price hasn't found its bottom, April lows at 1.1109 and further 1.10893 may be targeted next.
Definitely keep an eye on the fundamentals as always but especially now because of the tensions around the trade war between the U.S. and China. The Euro is still very vulnerable to these matters and there may be more choppiness in the price action. But this should be well-known to anyone who has traded the pair before anyway.
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However, the overall picture is bearish, since we're still in a big downtrend. Once the price breaks above the 100 EMA on a daily chart around the 1.13070 level and finally the 200 EMA around 1.14158, the trend may change. So, it remains to be seen whether the price can revisit the April highs in that current correction movement. Until the price hasn't found its bottom, April lows at 1.1109 and further 1.10893 may be targeted next.
Definitely keep an eye on the fundamentals as always but especially now because of the tensions around the trade war between the U.S. and China. The Euro is still very vulnerable to these matters and there may be more choppiness in the price action. But this should be well-known to anyone who has traded the pair before anyway.
Please support my idea by hitting the like and leaving your thoughts.