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EUR/USD Technical Analysis: Eyeing Resistance Above 1.17 Mark

EUR/USD Technical Analysis: Eyeing Resistance Above 1.17 Mark

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Talking Points:

  • EUR/USD Technical Strategy: Flat
  • Euro breaks 14-month resistance, aims to extend gains vs. US Dollar
  • Nascent RSI divergence, turning sentiment argues against long trade

The Euro looks set to continue its upward march after prices powered through resistance liming the upside against the US Dollar since early May 2016. That the single currency’s stubborn upward push is happening in defiance of the ECB seems to imply formidable conviction.

A daily close above the 38.2% Fibonacci expansion at 1.1722 opens the door for a challenge of the 50% level at 1.1830. Alternatively, a reversal back below resistance-turned-support at 1.1588 – the 23.6% Fib – paves the way for a retest of the 14.6% expansion at 1.1505.

As resilient as the Euro seems, a long trade chasing it higher doesn’t appear attractive. Early signs of negative RSI divergence may be seeping through to hint at ebbing momentum, a sense reinforced by shifting sentiment studies. With that in mind, a wait-and-see approach is probably prudent.

What will drive the longer-term trend in the Euro? See our forecast here !

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