EUR/USD rebounds and continues to consolidate around 1.2300

EUR/USD rebounded after hitting a fresh daily low at 1.2288. The euro rose back above 1.2300 and recently reached 1.2324, the highest level since the European session. Still remains far from the highs. It continues to consolidate near 1.2300. 

The rebound took place amid a deterioration of the US Dollar across the board. The US Dollar Index dropped back below 90.00 and it was moving toward daily lows. The greenback weakened amid a slide in US stocks. The Dow Jones was falling 0.55%, after losing more than 200 points from daily highs. 

The pair continued with its recent up move despite the release of the New York Fed survey that showed 1 and 3-year inflation expectations edged up in February. 

Technical outlook

On an intraday basis, the euro recovered strength by rising above the 20-hour moving average that stands around 1.2315 but on a wider perspective, the pair continues to consolidate, near the 1.2300 area. The consolidation takes place after the sharp drop of last Thursdays pos-ECB meeting. 

Now the pair is moving sideways, without a clear direction on a quiet Monday that suggests it could continue to move around 1.2300 for the next hours. 

The upper limit of the range could be seen around 1.2330, so a consolidation on top could signal more gains ahead. The next resistance levels are seen at 1.2360 and 1.2385. On the flip side, a decline significantly below 1.2290 would expose last week lows at 1.2270. A break lower would add more bearish pressure, exposing the next strong support at 1.2240.