FXStreet (Guatemala) – EUR/USD‘s demand overnight that took the major up to a few pips shy of the 1.14 handle has stalled as we progress through the US session.
The price has moved below the 20 SMA on the hourly chart again and could be headed for an hourly stick close below it for the first time since the 8th of October when the 20 SMA moved up through the 50 SMA at the climax of the bullish trend that has been building from 22nd September from 1.1110 region.
EUR/USD approaches Critical territory
EUR/USD recently broke up through the 1.1330 21st September highs on a spike that provoked further demand and run at 1.1400 brought on by markets starting to price out a Fed rate hike this year. A break of that level would be significant and will open-up the long-term resistance levels where May, June and September were all capped at around 1.1450 give or take.
EUR/USD headed to strong area of resistance
This is likely to be a strong area of resistance given it is where the May 2014 – Feb 2015 downtrend started to consolidate and is also the weekly 55 MA at 1.1468 is located. Perhaps we might see a phase of consolidation between the 50 MA 1.1353 and 55 MA weeklies for the time being while staying above the 1.1260 base of the cloud.
The main drivers for the week ahead stay with US and EZ CPI’s along with US retails sales, industrial productions and German ZEW’s.
(Market News Provided by FXstreet)