EUR/USD’s initial test through the April lows at 1.3676 (double top trigger for a measured move decline to just below 1.34) has stalled. Strategists at TD Securities also explained that the pattern of short-term price signals suggests the risk in the early part of the coming week at least is for a minor rebound in spot. “The daily chart shows price forming a big “doji” candle Thursday, suggesting a stall in the move down”.
EUR/USD looking for upside
The strategists explained that they look for gains back above 1.3730/40 (100-day MA currently at 1.3741) to trigger a short-term recovery to 1.3805 (40-day MA) plus. “But with short-term trend momentum signals aligned bearishly across a range of timeframes, we rather think gains will be limited in duration and scope and provide an opportunity for sellers”.
EUR/USD on the weekly
“The big, bearish reversals on the daily and weekly charts last week still suggest the main risk in EUR/USD is lower. The longer-term picture has not changed only the net loss for the EUR this week “confirms” in a technical sense the bear reversal signal from last week. Weekly trend support-turned-resistance is rising at a rate of 25 ticks per week, putting key weekly resistance at 1.3840 in the week ahead”.
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