EUR/USD continued trading north on Tuesday, breaking above the resistance (now turned into support) barrier of 1.1700, marked by the peak of the 1st of August. The pair has been in a recovery mode since the 15th of the month, while last Friday, it managed to emerge and close above the prior medium-term downside resistance line drawn from the peak of the 14th of April. In our view, the break above that line keeps the door open for the pair to continue its upside trajectory for a while more.
We believe that the break above 1.1700 may have opened the way for the 1.1750 zone, which acted as a strong resistance obstacle from the 10th until the 31st of July. If the bulls are strong enough to overcome that zone this time, then we may see them extending the rally towards the 1.1790 hurdle, marked by the peak of the 9th of July.
Looking at our short-term oscillators, we see that the RSI rebounded from its respective upside support line and crossed above 70. It continues to point up, even within its above-70 territory. The MACD lies above both its zero and trigger lines, pointing north as well. These indicators detect strong upside momentum and support the notion for EUR/USD to continue drifting higher.
On the downside, we would like to see a decisive break below 1.1640 and the short-term uptrend line taken from the low of the 15th of August before we abandon the bullish case, at least in the near-term. Such a break could encourage the bears to drive the battle towards the 1.1600 level, the break of which could tempt them to challenge the prior medium-term downside resistance line drawn from the peak of the 14th of April as a support this time.
Disclaimer:
The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. JFD Brokers, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD Brokers analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyzes and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyzes and must therefore be viewed by the reader as marketing information. JFD Brokers prohibits the duplication or publication without explicit approval.
FX and CFDs are leveraged products. They are not suitable for every investor, as they carry high risk of losing your capital. You should be aware of all the risks associated with trading on margin. Please read the full Risk Disclosure.