EUR/USD outlook: Hits pre-war levels, on track for further gains on growing risk appetite

Slobodan Drvenica Windsor Brokers

EUR/USD

The Euro jumped to two-month high on Friday, as bulls regained traction after eight-day rally paused for narrow consolidation in past two sessions.

Further drop of the dollar continued to fuel risk appetite and provided fresh support to the single currency, which recovered all losses caused by the war in the Middle East in past almost two months.

Fresh strength cracked important Fibo resistance at 1.1826 (61.8% of 1.2082/1.1410 descend) and look for confirmation of bullish signal on weekly close above this level.

The pair is on track for the third consecutive weekly gain, with strong acceleration higher, seen in past two weeks.

Daily studies remain in firm bullish configuration, with the structure being boosted by break above thickening daily Ichimoku cloud that contributes to bullish near-term outlook.

However, strongly overbought Stochastic and north-heading RSI approaching the boundary of overbought territory, send initial signal that bulls may start to face headwinds.

In the current circumstances, consolidation or limited pullback (ideally to find footstep above 1.1750 zone) should provide better levels to re-enter bullish market for 1.1900+ extension.

Keep an eye on developments on the ground over the weekend that would have an impact on Monday’s opening.

Res: 1.1875; 1.1900; 1.1924; 1.2000.
Sup: 1.1826; 1.1770; 1.1746; 1.1700.

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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