- The EUR/USD pair could register sharp movements after the US data dump.
- The price action signaled an imminent upside breakout.
- Staying below the upper median line (UML) and making a new lower low could activate a new sell-off.
The EUR/USD price is bullish in the short term as the Dollar Index remains under deep selling pressure. Technically, the currency pair reached a resistance area, so a bearish pattern could announce a new sell-off as the bias remains bearish despite temporary rebounds.
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Still, the USD could dominate the currency market only if the Dollar Index jumps higher after its temporary retreat. Surprisingly or not, the EUR/USD pair stays higher even if the US data came in better than expected yesterday.
Durable Goods Orders rose by 0.7%, beating the 0.1% expected, and Core Durable Goods Orders surged by 0.7% versus 0.4% forecasted. In comparison, Pending Home Sales also reported 0.7% growth, even if the traders expected a 3.5% drop.
Earlier, the German Gfk Consumer Climate came in at -27.4 points versus -27.5 expected and compared to -26.2 points in the previous reporting period. Later, the US data could be decisive, and the volatility could be high around the CB Consumer Confidence, which is seen as a high-impact event.
The indicator is expected to drop from 106.4 to 100.0 points. This could be bad for the greenback in the short term. In addition, the US is to release the Goods Trade Balance, Prelim Wholesale Inventories, HPI, S&P/CS Composite-20 HPI, and the Richmond Manufacturing Index.
EUR/USD price technical analysis: Supply zone
The EUR/USD pair registered a new false breakout with great separation through the 1.0601 static resistance signaling exhausted buyers. The 1.0600 psychological level stands as a major upside obstacle. Still, the price action signaled strong upside pressure after failing to make a new lower low.
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Staying near 1.0601 could signal an imminent upside breakout and further growth. Personally, I’ve drawn a descending pitchfork, hoping that I’ll catch a new sell-off. Now, the price retested the upper median line (UML), which is a dynamic resistance. Staying below this line and making a new lower low could activate a potential downside movement.
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