EUR/USD daily overview

FX:EURUSD   Euro / U.S. Dollar
The strong support of the 200-hour SMA allowed the the Euro bulls to grow stronger during the second part of Friday. Even though this up-move was not very significant, the pair did manage to breach its nearest resistance formed by the 23.60% Fibonacci retracement and a downward-sloping trend-line at 1.2358. '

The Asian session showed no changes to the overall price level, as further advance is restricted by the 1.2380 mark.

Given that the prevailing trend-line was breached to the upside, it is likely that the Euro continues to appreciate against the US Dollar during the following session. This scenario is likewise supported by technical indicators. Gains could be capped near the monthly R1 and a channel line near the 1.2440 mark.

Despite receding fears of trade wars, the US Dollar failed to pick up momentum on Monday, thus allowing EUR/USD to breach the psychological 1.24 level and reach a new six-week high of 1.2450.

The rate managed to breach the monthly R1 and a medium-term channel along the way. Further advance, however, did not follow, as the pair remained located slightly below the weekly R2.

From technical point of view, the last few trading sessions show that the Euro has initiated a new wave up after reversing from the senior channel on March 20. This suggests that the Euro could continue climbing even further this week. However, bulls might allow for a slight correction south down to the 1.24 area today.

In case bulls continue to dominate, upside target is 1.2560 which has provided strong support beforehand.

Monday’s climb of EUR/USD was reversed yesterday, as the market responded negatively to missed confidence estimates in the Euro zone.

Some bearish pressure was added by ECB officials who stressed the importance of patience when removing the stimulus. As a result, the Euro reversed from its six-week high of 1.2468 and plunged 79 pips within a couple of hours.

This fall was stopped by the 55-hour SMA which remained the guiding force for the pair in the Asian session, as well. The 1.2376 mark has previously managed to form strong resistance/support, thus it is unlikely that this level, reinforced by the 100-hour SMA, is breached during the first part of the day.

The upside potential is up to the weekly R2 at 1.2480. Volatility is likely to be introduced by the US Final GDP to be released at 1230GMT.

Wednesday’s session was spent in a relatively calm manner for EUR/USD, as the rate remained fluctuating between the weekly R1, the 55– and 100-hour SMAs and a strong resistance/support level at 1.2376.

The necessary momentum to breach the southern barrier was provided mid-session. Better-than-expected US GDP data put downward pressure on the pair as a result of which the Euro plunged 0.84% in a couple of hours. The 200-hour SMA and the weekly PP were likewise breached.

It is expected that the general tendency for the pair is northwards today, as supported by technical indicators. Bulls could find some resistance near the 1.2350 area, but it should eventually be breached to allow for a test of the daily high at 1.2380. Meanwhile, a fall below 1.23 is unlikely.

The common European currency remained stable against the Greenback on Thursday. A move above the 1.2340 was restricted by the weekly PP and the nearby-located 200-hour SMA, while strong support was provided by the bottom boundary of a five-month ascending channel.

It is likely that the pair tries to move higher today; however, big advances are unlikely to follow in this session, as the 1.2350 area is restricted by the 55– and 200-hour SMAs and the 23.60% Fibonacci retracement. Fundamentals are likewise unlikely to support a breakout above this mark, as markets of major economies, including the US and Germany, are closed for Easter Holidays.

The senior channel is expected to hold, thus squeezing the rate between these two barriers until early Monday.
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