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EUR/USD Technical Analysis: Digesting Below 1-Month High

EUR/USD Technical Analysis: Digesting Below 1-Month High

Ilya Spivak, Head Strategist, APAC

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Talking Points:

  • EUR/USD Technical Strategy: Flat
  • Euro corrects lower after rising to one-month high vs. US Dollar
  • Waiting for upswing to fizzle to sell in line with long-term down trend

The Euro edged lower for a third consecutive day as prices digest gains having advanced to the highest level in a month against the US Dollar. The series of higher highs and lows established from the March 2 swing low remains intact however, hinting the very near-term bias still favors the upside.

A daily close below the 14.6% Fibonacci expansion at 1.1202 opens the door for a test of the 23.6% level at 1.1094. Alternatively, a push above the February 11 high at 1.1376 sees the next upside barrier at 1.1495, the October 15 top.

We expect the long-term EUR/USD down trend to resume, in line with our 2016 fundamental forecast. That paints recent gains as broadly corrective, amounting to a selling opportunity. With that in mind, an actionable bearish reversal signal is absent for the time being. As such, we will remain on the sidelines for now.

What does FXCM traders' positioning mean for EUR/USD? Find out here !

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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