EUR/USD outlook: EUR/USD so far lacks strength for stronger recovery

Slobodan Drvenica Windsor Brokers

EUR/USD

EURUSD is in recovery mode on Wednesday, as oversold conditions on daily chart prompted a partial profit-taking and much weaker than expected US ADP report added to support.

Daily RSI emerged from oversold territory and 14-d momentum is heading north (although still in negative zone), contributing to positive near-term outlook.

Fresh recovery see break above falling 10DMA (1.0554) as a minimum requirement to generate firmer bullish signal, which will look for confirmation on extension and close above 1.0611/26 pivots (broken Fibo 38.2% of 0.9535/1.1275 / falling 20DMA) to open way for stronger recovery.

Otherwise, the downside would remain vulnerable and risk violation of 1.0405 (50% retracement of 0.9535/1.1275) which would spark fresh acceleration lower.

US NFP report for September is the key event of the week and will be closely watched for fresh signals.

Res: 1.0554; 1.0611; 1.0626; 1.0700

Sup: 1.0448; 1.0405; 1.0305; 1.0200

Interested in EUR/USD technicals? Check out the key levels

1. R3 1.0622
2. R2 1.0577
3. R1 1.0541
PP 1.0496
1. S1 1.046
2. S2 1.0415
3. S3 1.0379

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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