Technical Analysis – EURUSD close to 14½-month high; bullish in the medium-term

EURUSD reached a fourteen-and-a-half-month high of 1.1489 during Wednesday of last week. The price is down in today’s trading so far after advancing by 0.6% during Friday’s trading.

Looking at the Ichimoku analysis, the positive alignment when the Tenkan-sen line (red) crossed above the Kijun-sen (blue) in late June is still in place – this hints to a bullish market bias. Despite this, momentum in the very short-term seems to be on the downside as indicated by the downward trending RSI.

The area around last Wednesday’s high of 1.1489 could prove to be a major barrier to the upside. Should the price climb above, resistance is likely to be met around the 1.15 handle as well.

On the downside, support might be formed around the current level of the Tenkan-sen at 1.14. If this is violated, additional support could come around last Thursday’s eleven-day low of 1.1370.

Concerning the medium-term outlook, a bullish cross was formed in mid-May when the 50-day moving average (MA) crossed above the 200-day MA. This points to a positive medium-term picture and price action taking place above the cloud, 50- and 200-day MAs since late April is supporting the strength of this signal.

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