Technical Bias: Short-term Bullish
Key Takeaways
- Euro gained some momentum this past week and it looks set for a short-term spike higher.
- EURUSD has a monster resistance around the 1.1200 level where sellers are likely to appear.
- Euro area Consumer Confidence will be released by the European Commission, which is expected to come in at -5.95 in March 2015.
Euro traded higher this past week against the US dollar, but buyers might struggle to maintain strength as there are several hurdles on the way up for EURUSD.
Technical Analysis
There was a strong support in EURUSD around the 1.0500 area where the Euro sellers struggled to take the pair lower. There is a very critical bearish trend line formed on the daily chart of the EURUSD pair, which is likely to act as a hurdle in the near term. The most important thing to note that the 50-day simple moving average is sitting just below the highlighted bearish trend line. This is not all the 61.8% fib retracement level of the last drop from the 1.1451 high to 1.0467 low is positioned around the stated area. Let us see how the pair reacts in the near term if it reaches around the highlighted resistance area.
If the EURUSD fails to move higher, then it might head back towards an important support area around the 1.0650 levels.
There is one more point to note is the fact that the daily RSI is heading towards the 50 swing level.
Euro Area Consumer Confidence
Later during the NY session, the Euro area Consumer Confidence will be released by the European Commission. The forecast is lined up for a reading of -5.95 in March 2015, compared to the preceding reading of -6.70.
Trade Idea
One might consider selling rallies in the EURUSD pair around 1.10-12 as long as the pair stays below the 50-day SMA.
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