EUR/USD extended gains and managed to climb above 1.1200 during the American session as stocks in Wall Street extend losses. The Dow Jones was falling 2.05% and the Nasdaq was losing 3.05% while bonds were rising sharply. Crude oil was holding near the lows, slightly under $30.00 (WTI).
The pair rose further and broke above 1.1200. It reached a fresh daily high at 1.1214 and it was trading at 1.1205, 50 pips above Friday’s closing price.
Greenback was among the top performers during the first half of the day but then lost strength and dropped particularly against European currencies and the yen.
EUR/USD technical outlook
According to Valeria Bednarik, Chief Analyst at FXStreet, the 1-hour chart favors additional gains; technical indicators have recovered from negative territory, but present limited upward strength at the time being. “In the 4 hours chart, the price recovered above a bullish 20 SMA, around 1.1145, while the RSI indicator resumes its advance near overbought territory, and the Momentum indicator turns higher around its mid-line.
On a wider perspective, Bednarik notes that EUR/USD lack strength to confirm additional gains, “but the downside seems well limited with buyers surging on dips.”
(Market News Provided by FXstreet)