EUR/USD is continuing the bullish correction from last week, pushing above last week’s high around 1.0850, and tagging 1.09 during the 4/24 Friday European session. As we get ready for the US session, the 4H chart shows a tentatively bullish market.
EUR/USD is above the the cluster of 200-, 100-, and 50-period simple moving averages, but they are not in bullish alignment, and for the most part are sloping sideways. The RSI shows loss of the bearish momentum we saw in the first half of April, but failure to tag 70 reflects lack of bullish momentum as well.
This is a buyers market only in the near-term, and only if we get a pullback. For example a dip to 1.0750 might make a reward to risk profile for a buy attractive for a target of 1.10. Otherwise, it might be too risky.
On the other hand, as EUR/USD approaches the key resistance at 1.1040-1.1050, we should expect sellers again because the prevailing trend is still bearish, and the central banks ECB and the Fed are still on opposite side of the policy stance spectrum. The ECB is dovish as it implements QE, and the FOMC of the Fed is somewhat hawkish as it plans to raise interest rates, although that has been pushed back this year.
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