EUR/USD: Three-week uptrend channel – A chance to buy? [Video]
|EUR/USD
Throughout the past few sessions the euro has been increasingly positioning for an upside breakout above $1.1015. Yesterday’s solid bullish candle with a decisive close above $1.1015 signals a key shift in outlook for a pair that has been rangebound for the past eight weeks. It completes a rectangle breakout and implies around +250 pips of upside target towards $1.1250. With the breakout continuing today, the next key test will be the $1.1145 March lower high. The impressive move comes with the confirmation of momentum indicators, where RSI is now into the 60s (an 11 week high), Stochastics strong above 80 and MACD lines accelerating above neutral. We still note the tendency for intraday pullbacks and with the market around the top of what is now effectively a three week uptrend channel, this could limit the immediate scope for upside potential. We would look to now use an unwind within this channel as a chance to buy. The hourly chart shows good momentum with the breakout support now around $1.0990/$1.1030 which is a near term buy zone. Support at $1.0930 is also an important higher low.
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