EUR/USD retests range top as bulls eye breakout on light calendar
|Market overview
The euro is firm in early European trade, pushing to the top of a month-long range as the dollar stays subdued after last week’s softer U.S. manufacturing and labor signals. Today’s slate is light: Eurogroup meetings and a German Bund auction headline in Europe, while the U.S. session offers only energy releases and a 3-year auction ahead of heavier data later in the week. With few fresh catalysts, price action is doing the talking—EUR/USD is probing resistance built through August as volatility creeps higher.
Technical analysis
Current technical conditions and main scenario
On the 4-hour chart, EUR/USD trades around 1.1769 at the upper edge of a well-defined consolidation box drawn from roughly 1.1703 to the 1.1760/80 area. Price rides above the mid Bollinger band (the 20-period SMA), and upper/lower bands are widening—typical of a range-break setup. The immediate pivot is the recent 100% projection at 1.1759.
If buyers secure a 4-hour close above 1.1760/80, the breakout sequence targets 1.1774 (127.2% extension), then 1.1794 (161.8%), with 1.1815 (200%) as an extended objective.
Oscillators
MACD has crossed above the signal line and is building a positive histogram—momentum aligning with the upside attempt. Money Flow Index is elevated near 89, signaling strong buy-side pressure but also cautioning against chasing without confirmation. OBV has turned higher, confirming accumulation during the push to resistance.
Key levels
- Supports: 1.1738 (61.8% pullback of the latest leg), 1.1720 (mid-band/20-SMA zone), 1.1703 (range floor/0.0% base).
- Resistances: 1.1760/80 (range cap/100% projection), 1.1774, 1.1794, 1.1815 (extension band).
Alternative scenario (lower probability)
If buyers fail to clear 1.1760/80 and price slips back below 1.1738, intraday momentum likely rotates into a range fade toward 1.1720. A decisive break under 1.1703 would negate the topside setup and reopen 1.1670–1.1650.
Fundamental outlook
The calendar argues for a sentiment-driven session. In Europe, the Bund auction and any color from Eurogroup meetings will be scanned for growth and fiscal signals, but neither typically moves the needle unless surprises emerge. In the U.S., a quiet afternoon (EIA outlook, API crude, and a 3-year auction) keeps the focus on broader dollar dynamics—namely, whether recent signs of cooling activity continue to feed rate-cut expectations into the next batch of data. Net: with limited macro impulses today, EUR/USD direction likely hinges on whether bulls can convert momentum into a clean breakout; absent that, the pair risks slipping back into the 1.17-handle range.
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