EUR/USD Technical Analysis: Two-Month Down Trend Broken
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- EUR/USD Technical Strategy: Flat
- Euro posts largest gain since June, breaks 2-month down trend vs. US Dollar
- Short trade stopped out, current chart positioning bereft of actionable setup
The Euro launched sharply higher to score the largest daily in close to five months and break a two-month down trend against the US Dollar. The single currency’s impressive surge was triggered after third-quarter German GDP data registered significantly stronger than economists expected.
Near-term resistance is now at 1.1823, the 50% Fibonacci retracement, with a break above that on a daily closing basis opening the door for a test of the 61.8% level at 1.1887. Alternatively, a move back below the 38.2% Fib at 1.1760 sees the next major downside barrier at 1.1681, the 23.6% Fib.
The shortEUR/USD trade triggered at 1.1640 on the premise that prices had completed a large Head and Shoulders topping pattern has been stopped out. Current positioning does not offer an attractive setup to re-establish exposure on the long or short side, so opting for the sidelines seems most prudent.
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