EUR/USD outlook: Post-ECB recovery faces strong obstacles en-route

Slobodan Drvenica Windsor Brokers

EUR/USD

The Euro remains constructive on Friday after previous day’s jump on ECB rate hike (the first in three years).

The latest news about potential peace deal in the Middle East also contributes to fresh positive tone, although markets need more evidence before reacting.

The pair probes again through initial barriers at 1.1580 zone (10DMA / Fibo 23.6% of 1.1849/1.1500) and need firm break higher to confirm a higher base at 1.1500 zone (formed after a double downside rejection and generate initial reversal signal.

However, daily indicators are still in bearish setup (MAs / negative momentum studies) that keeps the downside vulnerable, particularly while the price holds below the base of daily Ichimoku cloud / Fibo 38.2% (1.1630).

In such scenario, limited upticks would provide better levels to re-enter larger downtrend from 1.1850 (mid-Apr peak).

Res: 1.1602; 1.1630; 1.1645; 1.1674.
Sup: 1.1557; 1.1500; 1.1443; 1.1410.

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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