EUR/USD Technical Analysis: Euro Soars to Two-Month High
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- EUR/USD Technical Strategy: Flat
- Euro jumps to two-month high as SPD/CSU/CDU coalition rumors circulate
- Actionable setup with improved risk/reward parameters needed to enter trade
The Euro vaulted to the highest level in two months against the US Dollar, with prices re-establishing a foothold above the 1.19 figure. The single currency surged amid speculation that Germany’s main opposition SPD party is mulling another coalition government with Chancellor Merkel’s CSU/CDU bloc.
Near-term resistance is now at 1.1967, the 23.6% Fibonacci expansion, with a daily close above that opening the door for a challenge of the September 8 high at 1.2092. Alternatively, a move back below resistance-turned-support at 1.1857 exposes the 1.1662-79 area (August 17 low, 23.6% Fib retracement) anew.
An actionable trade setup seems to be absent for the time being. Prices are too close to resistance to justify entering long from a risk/reward perspective while the absence of a clear-cut bearish reversal signal argues against taking up the short side. Opting for the sidelines is probably best until a better opportunity emerges.