With the recent upside move, the EURUSD has run into resistance at 1.3500. The round figure holds some formidability, given it prevented a similar break higher back in February last year and is likely to remain steadfast in light of this new bullish wave. Technical oscillators are supportive of the notion, remaining in overbought territory, and printing an 88.28 count.
As a result, any failure to break above the barrier would purport a decline towards initial support via the 1.3154 figure.
However, upside penetration of the current resistance barrier would prompt a likely extension higher towards subsequent resistance circa 1.3832. However, the notion remains contingent on a concerted close above the 1.3495 fib resistance level.
Euro Optimism Grows
Sentiment of further Euro appreciation is being widely supported by a growing net long position in the single currency per the CFTC’s Commitment of Traders report. The latest edition – for the week ending January 22nd – showed that Euro longs were built by the tune of $2.3 billion to a net long $3.6 billion position. This is a 192% increase in long positioning week over week, and remains bullishly supportive of a potential break out of the resistance figure.
Thing To Keep In Mind
With little data set for the next 48 hours, traders will be keeping an eye out for the GfK German consumer sentiment survey set for release tomorrow. Although the report is expected to eke higher to 5.8 from last month’s 5.6, the uptick would represent the first gain in the last three months, and compound on already growing optimism portrayed by both the Ifo and ZEW surveys last week.