Technical Analysis – EURUSD challenges key uptrend line
August 3, 2023 1:26 pm
EURUSD has been in a sliding mode since July 18, when it hit resistance at around 1.1280, the highest point since February 2022. However, the pair has taken a breather near the crossroads of the 100-day exponential moving average (EMA) and the uptrend line drawn from the low of September 23, which keeps the near-term outlook cautiously positive.
The MACD lies below its trigger line, but holds fractionally above zero, while the RSI runs below its equilibrium 50 line, but has just ticked up. Both indicators reflect the latest correction, but they keep the prospect of a potential rebound alive.
Such a rebound may be triggered by a downside surprise in tomorrow’s US employment data and the bulls may feel comfortable again to travel towards the 1.1280 zone, where a break will confirm a higher high on the daily chart and perhaps pave the way towards the 1.1480 territory, which offered strong resistance back in January and February 2022.
On the other hand, a strong jobs report could result in a break below the aforementioned uptrend line, but the signal that could hint at a stronger retreat may be a potential dip below the 1.0835 support zone and the 200-day EMA. Such a dip could initially challenge the important 1.0665 zone and if the bears are not willing to exit there either, then they could extend their march towards the 1.0530 territory, which stopped the pair from moving lower in February and March this year.
To recap, EURUSD is currently testing a key uptrend line, with traders perhaps waiting for tomorrow’s US employment report to decide whether to break it or extend the prevailing uptrend.
EURUSD has been in a sliding mode since July 18, when it hit resistance at around 1.1280, the highest point since February 2022. However, the pair has taken a breather near the crossroads of the 100-day exponential moving average (EMA) and the uptrend line drawn from the low of September 23, which keeps the near-term outlook cautiously positive.
The MACD lies below its trigger line, but holds fractionally above zero, while the RSI runs below its equilibrium 50 line, but has just ticked up. Both indicators reflect the latest correction, but they keep the prospect of a potential rebound alive.
Such a rebound may be triggered by a downside surprise in tomorrow’s US employment data and the bulls may feel comfortable again to travel towards the 1.1280 zone, where a break will confirm a higher high on the daily chart and perhaps pave the way towards the 1.1480 territory, which offered strong resistance back in January and February 2022.
On the other hand, a strong jobs report could result in a break below the aforementioned uptrend line, but the signal that could hint at a stronger retreat may be a potential dip below the 1.0835 support zone and the 200-day EMA. Such a dip could initially challenge the important 1.0665 zone and if the bears are not willing to exit there either, then they could extend their march towards the 1.0530 territory, which stopped the pair from moving lower in February and March this year.
To recap, EURUSD is currently testing a key uptrend line, with traders perhaps waiting for tomorrow’s US employment report to decide whether to break it or extend the prevailing uptrend.
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