EUR/USD analysis: waiting for market's to resume activity

Valeria Bednarik FXStreet

EUR/USD Current price: 1.2396

Tuesday only relevant figure to be the German ZEW survey.
Dollar benefits from dull trading modestly up across the board.

The American dollar edged marginally higher in a dull Monday, with multiple holidays keeping volumes at their minimum. China, Canada, and US markets have been closed amid different local celebrations, keeping the macroeconomic calendar also extremely thin. Dollar gains through the day seem a follow-through of Friday's advance but still seems corrective in the middle of its bearish trend. The EU released some minor macroeconomic figures that anyway didn't affect the market, the December current account which recorded a surplus of €29.9 billion, below the expected €30.5B, or a previously revised €35.0B, while in the same month, Construction output posted a modest 0.1% advance MoM and 0.5% YoY. Tuesday will bring little from the fundamental side, with the only relevant release being the German ZEW sentiment survey for February.

The 4 hours chart shows that the pair spent the day below the 38.2% retracement of its latest bullish run between 1.2205 and 1.2554 at 1.2420, with short-lived spikes beyond the level being quickly reverted. In the same chart, the 20 SMA has lost upward strength, turning flat some 60 pips above the current level, while the technical indicators entered bearish territory, but lack directional strength at the time being, amid the limited intraday range. The pair has an immediate short-term support at 1.2380, the next Fibonacci level, but a more relevant one at 1.2340, where it has the 61.8% retracement of the mentioned rally.

Support levels: 1.2380 1.2340 1.2300

Resistance levels: 1.2425 1.2450 1.2490

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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