EUR/USD is staging a recovery post a flawed test of the downside. A bullish descending wedge pattern that followed on is currently pushing the pair higher. A break above the 50-day moving average (DMA) at 1.1813 smooths further progress to meet this wedge’s minimal target set around 1.1905, as reported by DBS Bank.
See: EUR/USD to extend the bounce on a break above 1.1860 – SocGen
Technical indicators flip higher to support EUR’s upmove
“EUR’s push higher from recent 1.1664 lows is clearly supported by a bullish descending wedge reversal pattern. The technical indicators have flipped higher to support EUR’s move higher, but positioning remains reticent ahead of the 26 September German federal elections, given Chancellor Angela Merkel’s heir apparent Armin Laschet (leader of the CDU) has so far staged a less than convincing campaign.”
“EUR is breaking the 50-DMA at 1.1813. This puts EUR in the pole position to target its minimal wedge objective around 1.1905 which sits between 1.1909 (the prior high, before EUR made the move for 1.1664 lows) and the 38.2% Fibonacci retracement of the most recent range grip of 1.2266-1.1664, at 1.1894. These levels stand just below the 100-DMA at 1.1958.”
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