EUR/USD Forecast: technically biased towards 1.1000/50

Another week comes to an end with market's participant overwhelmed by disappointing US data, and the Greek merry-go-round. In the US, Existing Home sales was the only reading beating expectations, but New Home sales, weekly unemployment claims, and manufacturing reports all resulted worse-than-expected. In Greece, the optimism of the country is being denied by the rest of the Euro zone that continues to ask for a serious reform commitment before extending bail-outs. Rivers of ink written on the latest, with all being about rumors, comments, and "people familiar with the matter."

Nevertheless, the EUR/USD managed to close the week higher, around 60 pips above its weekly opening, and with the weekly chart showing a higher low and a higher high, usually a sign of mounting bullish pressure. The recovery that began the previous week has dragged the weekly indicators further above from extreme oversold levels, albeit the stay well below their mid-lines. In the same chart, the price is pointing to close the week above the 61.8% retracement of its latest decline, supporting a retest of the 1.1000/50 region. In the daily chart, technical indicators are biased higher above their mid-lines, whilst the price extended above a directionless 20 SMA.

With the FOMC Meeting next week, the pair may continue to trade within familiar ranges at the beginning of the next week,  but with the market going into the meeting with limited hawkish expectation, chances are of a move higher: a break above 1.0900 should lead to a retest of the mentioned 1.1000/50 region, while if it manages to advance above this last, 1.1120 comes next. The 1.0710 level, 38.2% retracement of the same bearish run is the key support to follow, as if the price falls beyond it, the decline can extend down to 1.0620, whilst below this last, the year low at 1.0460 comes next. 


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