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EUR/USD Technical Analysis: Euro Soars to 12-Month High

EUR/USD Technical Analysis: Euro Soars to 12-Month High

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Talking Points:

  • EUR/USD Technical Strategy: Flat
  • Euro breaks out of monthly range, surges to one-year high
  • Resolution at resistance sought to offer trading opportunity

The Euro has shot sharply higher after a month of consolidation in a choppy range, rising to the highest level in a year against the US Dollar. Appropriately enough, the single currency’s surge marked its best single-day performance in just about the same amount of time, with the last similar rise seen in early June 2016.

Near-term resistance is now at 1.1394, the 38.2% Fibonacci expansion, with a break above that confirmed on a daily closing basis opening the door for a test of the 50% level at 1.1480. Alternatively, a turn back below the 23.6% Fib at 1.1288 sees the next downside barrier at 1.1223, the 14.6% expansion.

Prices are too close to immediate resistance to justify entering long from a risk/reward perspective. At the same time, the absence of a clear-cut bearish reversal signal hints that it is premature to try to fade the move higher. On balance, opting for the sidelines seems most prudent for now.

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