The Euro continues to take advantage of the weakened US Dollar, driven by hopes on the new German coalition.
The pair started its surge mid-Thursday and has since appreciated 2.37%. As a result, the it breached the upper boundary of an ascending channel valid since late October, as well as the rate had reached its highest point since 2015 by early today.
As apparent on the chart, the strong upside momentum has allayed in this session due to the pair testing the monthly R2 at 1.2219. Technical indicators are located near their historic highs, thus pointing to a soon period of decline. This scenario, however, might not occur today, as the Euro could still push towards the weekly R1 at 1.2308.
In case the bearish sentiment takes over, the weekly PP and the monthly R1 circa 1.2111 are likely to limit the pair.
The pair started its surge mid-Thursday and has since appreciated 2.37%. As a result, the it breached the upper boundary of an ascending channel valid since late October, as well as the rate had reached its highest point since 2015 by early today.
As apparent on the chart, the strong upside momentum has allayed in this session due to the pair testing the monthly R2 at 1.2219. Technical indicators are located near their historic highs, thus pointing to a soon period of decline. This scenario, however, might not occur today, as the Euro could still push towards the weekly R1 at 1.2308.
In case the bearish sentiment takes over, the weekly PP and the monthly R1 circa 1.2111 are likely to limit the pair.
Comment:
Even though the Euro has increased its trading range against the US Dollar during the previous session, the pair has failed to form a distinctive movement either direction. The rate reached a new 2015/2017 high early today; however, further advance was restricted by the weekly R1 at 1.2307.
Despite a failure to breach the 55-hour SMA, it seems that bears are gradually starting to provide resistance to the prevailing bullish sentiment. It is even possible that this moving average surrenders in this session, thus allowing for a test of the 100-hour SMA. If such scenario is to occur, the rate is likely to remain stranded between these lines for the remaining session.
Conversely, the 55-hour SMA could provide an unbreakable support, thus sending the rate for the 1.23 area; this level is expected to hold firm.
Despite a failure to breach the 55-hour SMA, it seems that bears are gradually starting to provide resistance to the prevailing bullish sentiment. It is even possible that this moving average surrenders in this session, thus allowing for a test of the 100-hour SMA. If such scenario is to occur, the rate is likely to remain stranded between these lines for the remaining session.
Conversely, the 55-hour SMA could provide an unbreakable support, thus sending the rate for the 1.23 area; this level is expected to hold firm.
Apart from a 50-pip surge md-Monday, the common European currency showed no intention to leave its narrow trading range, thus leaving the market at a relative equilibrium.
Even though bulls did not push higher in the previous sessions, bears nevertheless failed to take the upper hand. This suggests that bulls could still gather slight momentum and push the rate higher. A possible upside target in this case could be the weekly R1 at 1.2308. The pair’s subsequent movement should be tended south towards the upper boundary of the breached ascending channel and the 55-hour SMA circa 1.22.
By and large, the US Dollar still remains weakened against its major counterparts. Thus, the Euro will continue surging until this period of value decline ends.