EUR/USD Price: Euro rallies to Multi- Month High against USD – What’s Next?
EUR/USD Technical Analysis
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EUR/USD – Buyers in Charge
Last week, Euro firmed up against US Dollar and printed 1.1173 – its highest level in over three months. On Friday, the price closed the weekly candlestick with nearly 1.2% gain.
Alongside this, the Relative Strength Index (RSI) rose from 57 to 67 indicating to the bullish outlook of the market.
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EUR/USD Daily PRice CHART (Mar 31, 2017 – OCt 21, 2019) Zoomed Out
EUR/USD Daily Price CHART (July 3 – Oct 21, 2019) Zoomed in
Looking at the daily chart, we notice on Wednesday EUR/USD rallied to a higher trading zone 1.1060- 1.1215 and closed above the 50-day average for the first time in three months, providing a clear bullish signal . Therefore, the price may rally towards the high end of the zone contingent on clearing the weekly resistance level underlined on the chart (zoomed in).
A close above the high end of the zone could push EURUSD towards the vicinity of 1.1286-1.1303. Nevertheless, the weekly resistance levels underscored on the chart should be kept in focus.
That said, any failure in closing above the high end of the zone would mean weakness in the current bullish momentum. This could increase the likelihood of a reversal towards the low end of the zone. Further close below the low end of the zone could see EURUSD trading even lower towards 1.0912. In that scenario, the weekly and daily support area and levels marked on the chart should be watched along the way.
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EUR/USD four Hour Price CHART (SEp 13 – Oct 21, 2019)
From the four-hour chart, we notice on Oct 10 EUR/USD resumed bullish price action and created in the following day a higher high at 1.1062, then on Oct 16 bullish price action has accelerated and led the pair to levels never been tested since mid- August.
Hence, if buyers continue rallying EURUSD then a break above 1.1233 could push the price towards 1.1267. Although, the weekly resistance level underscored on the chart should be considered. On the other hand, the price may correct lower if falls below the oct 18 low. Thus, a break below 1.1109 may press EURUSD towards 1.1060. However, the daily support level underlined on the chart should be monitored.
See the chart to know more about key levels the price would encounter in a further bullish/ bearish move.
Written By: Mahmoud Alkudsi
Please feel free to contact me on Twitter: @Malkudsi
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.