EURUSD Technical Analysis | Forexlive
On the daily chart below for EURUSD, we can
see that as the price tried to break above the previous February high at
1.1033, it was strongly rejected back down. The move lower kicked in as US
Retail Sales missed expectations with a further extension of
the bearish move as Fed’s
Waller delivered hawkish comments and the 1
year inflation expectations in the University of Michigan survey showed a big
jump to the upside.
Maybe the market started to worry
about the recession after the retail sales numbers and the inflation
expectations numbers also helped to lift US Treasury yields giving the USD
further momentum.
Anyway, this setup may turn into
a major double
top with the
1.0533 level as the neckline. The moving
averages are still well crossed to the upside, so the bullish trend is intact
for now and the buyers will lean on the red long period moving average for
further support.
On the 4 hour chart below, we can
see that the whole move up from the 1.0759 breakout kept diverging with the MACD trading into the February high resistance. This is a signal of a weakening
momentum and generally we can see pullbacks or even reversals. All the pullbacks
ended when the price touched the trendline, so we can expect the buyers to
lean on this trendline with little downside risk to position for longs. The
sellers, on the other hand, will want to see the price breaking below the
trendline to pile in and push the price to the previous resistance now turned
support at 1.0759.
On the 1 hour chart below, we can
see that the bearish short-term trend out of the US Retail Sales report is now
waning as the price broke above the short-term downward trendline and the
moving averages are about to cross to the upside.
There is a little upward
trendline giving support for the current pullback and if we see the price break
below it, the sellers should push the price to the major trendline somewhere
around the 1.09 handle. The buyers, on the other hand, will have more
conviction to restart the bullish trend if the price breaks above the short-term
resistance at 1.0960.