EUR/USD Technical Analysis: Euro Challenges Monthly High
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- EUR/USD Technical Strategy: Flat
- Euro moves to test monthly high after Fed’s Yellen sinks US Dollar
- Gains seen as corrective, paving the way for future short trade setup
The Euro pushed aggressively higher against the US Dollar after finding support above the 1.11 figure, with prices now poised to challenge monthly highs. The single currency rallied the most in two weeks after a speech from Fed Chair Janet Yellen weighed against traders’ rate hike expectations.
Resistance now stands in the 1.1343-76 area, marked by the February 11 and March 17 swing highs, with a break above that on a daily closing basis paving the way for a test of the October 15 top at 1.1495. Alternatively, a reversal below the 23.6% Fibonacci retracement at 1.1220 exposes the 38.2% level at 1.1144.
Our fundamental outlook calls for the long-term EUR/USD down trend to continue in 2016.With that in mind, recent gains appear to be corrective and are expected to eventually deliver an opportunity to enter short. A defined reversal signal is absent for now however and we will stand side until something actionable presents itself.
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