EUR/USD Continues to Put Pressure on the 1.1040 Resistance

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EUR/USD Continues to Put Pressure on the 1.1040 Resistance

EUR/USD rallied from 1.0462 to 1.1040 last week. The main bullish breakout move followed the FOMC statement. After that, there was a sharp pullback, but that held above 1.06 and maintained a bullish outlook. Let’s follow up on the price action since this breakout and confirmation.

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The 4H chart shows that price has continued to threaten the 1.1040 resistance. During the 3/24 session, there was a bearish engulfing candle. However, this candle failed to extend the retreat and price held above 1.09. This suggests that the bulls in this market is in control in the short-term.

Also note the 200-period SMA just above 1.1040. A break above 1.1050 is likely to open up further bullish correction. When we look at the daily chart, we can see some room to rally until a key pivot around 1.1270. If price stalls here, and the daily RSI also stalls around 60, be ready for a bearish attempt at least to test the 1.09 level that acted as support in the previous couple of sessions.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.