EURUSD: Opens the doors for more upsides in the near-term

Technical Bias: Short-term Bullish

Key Takeaways

• Euro gained traction during this past week despite all tensions in the Euro zone regarding Greece bailout.

• German Gross Domestic Product will be released by the Statistisches Bundesamt Deutschland today during the London session.

• EURUSD has a swing support area around the 1.1280 level where the Euro buyers might appear.

Euro seems like forming a short-term bottom and if buyers gain strength then there is a chance of more upsides in the EURUSD pair.

Technical Analysis

The EURUSD pair broke an important bearish trend line on the daily chart, which opened the doors for more upsides in the near term. However, the pair is currently struggling around the 23.6% fib retracement level of the last from the 1.2570 high to 1.1165 low. The Euro buyers failed more than three times to clear the mentioned fib level so let’s see how the pair trades in the near term. If it moves lower from here, then the broken trend line might come into play. There is a worrying sign, as the daily RSI is well below the 50 level which might encourage the Euro sellers moving ahead.

If the EURUSD pair moves above the 23.6% fib level, then the next resistance is around the 50-day simple moving average, which is sitting below the 38.2% fib level.

During this week, the economic releases in the Euro zone might also play an important role in the near term.

German GDP

Later during the London session, the German Gross Domestic Product will be released by the Statistisches Bundesamt Deutschland. The forecast is slated for a minor gain of 0.7% in the fourth quarter of 2014. Let us see how the outcome shapes and affects the Euro.

Trade Idea

One might consider buying dips in EURUSD around the 1.1280 area as long as the fundamentals favor the Euro in the short term.