Trend daily chart
Rising fm o/s.
21 HR EMA
55 HR EMA
Trend hourly chart
Easing fm o/bot.
13 HR RSI
14 HR DMI
Consolidation with upside bias.
1.0350 – May’s low (now res).
1.0296 – 50% proj. of 1.0121-1.0268 fm 1.0222.
1.0268 – Tue’s high.
1.0201 – Mon’s high (now sup).
1.0175 – Mon’s Euroepan morning high (now sup).
1.0121 – Tue’s low.
EUR/USD – 1.0242.. Although euro remained on the back foot after a strong retreat fm Mon’s 1.0201 high to 1.0121 (Asia), price jumped in Europe on Reuters news report of a possible 0.5% rate hike by the ECB n hit 1.0268 b4 retreating.
On the bigger picture, despite euro’s LT upmove fm 2017 near 14-year low of 1.0341 to a fresh 3-year peak of 1.2555 in mid-Feb 2018, decline to a near 3-year 1.0637 low (Mar 2020) signals correction has ended. Although euro staged a rally to a near 33-month 1.2349 peak in early Jan 2021, subsequent selloff to 1.1705 (Mar) signals top is made. Euro’s break of 1.1705 n then firm breach below 2020 bottom at 1.0637 in Apr to a 5-year bottom of 1.0350 in mid-May n then break of 2017 trough of 1.0341 to a 20-year low of 0.9953 last Thur suggests price would head twd 0.9860 later this month, reckon 0.9640 should hold. Only a daily close abv 1.0191 confirms temp. low is made, risks 1.0221, abv, 1.0350.
Today, Tue’s impressive rally fm 1.0121 to a 12-day high of 1.0268 signals recent downtrend has made a low at last Thur’s fresh 20-year bottom at 0.9953 n rising indicators may send price to 1.0290/00, ‘bearish divergences’ would cap the pair below 1.0350 n yield decline. A daily close below 1.0201 risks 1.0121.
EUR/USD with a bullish price action ahead of ECB
(Gregor Horvat – Wavetraders)
The sell-off of the USD resumed yesterday as stocks found support with a “turnaround Tuesday” price action. We see commodity currencies very strong across the board, with room for further gains after retracement. However, EUR will be under the spotlight this week because of ECB situation and also because of Nord Stream. Putin said if the turbine return is delayed, the volume of the Nord Stream will drop and this can cause some serious issues in Europe. Technically however, the EURUS appears to be turning bullish as rising out of a downward channel is in five waves, so be aware of more gains after the retracement. Support is at 1.01-1.012. If ECB will hike more than 0.25bp then we think EURUSD is going to see much more upside.