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EUR/USD surpasses downtrend line.
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20- and 50-day SMA post bullish cross.
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RSI flattens but MACD ticks up.
EUR/USD has advanced considerably in the short-term timeframe, recording five consecutive green days and surpassing the medium-term descending trend line. Also, the 20- and 50-day simple moving averages (SMAs) posted a bullish crossover, mirroring the latest upswing. However, the pair has still been developing within a trading range of 1.0220-1.0530 over the last two months.
In case of steeper increases and a successful break of the 1.0530 roof, then the market could find the next resistance at the 100-day SMA at 1.0570, ahead of the 1.0630–1.0680 restrictive region. Further upside movements could take the bulls towards the 200-day SMA at 1.0746 and the 61.8% Fibonacci retracement level of the down leg 1.1215-1.0176 at 1.0817, which would act as a significant turning point for the market.
Conversely, a decline below the 1.0440 support and the downtrend line, aligning with the short-term SMAs at 1.0400, could reinforce the neutral bias once more, leading to a test of the 1.0280 support. Below that, the lower boundary of the consolidation area at 1.0220 could be a tough obstacle for the bears, but penetration of this area could send investors to the 26-month low of 1.0176.
The technical oscillators are showing some neutral-to-positive vibes. The RSI is flattening above the neutral threshold of 50, while the MACD is extending its positive momentum above its trigger and zero lines.
To sum up, EUR/USD has been in a neutral-to-bullish bias in the short- to medium-term timeframes as it is attempting to remain above the downtrend line, but the sideways channel still holds.
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