Euro bulls have marched into the trading week with a renewed sense of confidence, trampling the Dollar and intimidating most G10 currencies.
The currency’s positive performance since May has been nothing short of phenomenal, defying concerns fuelled by disappointing economic data and uncertainty revolving around COVID-19.
Given the Euro’s resilience against shaky fundamentals and fact that Eurozone GDP plunged by a record 12.1% in the second quarter of 2020, prices could push higher if economic conditions stabilize.
Time to talk technicals
Looking at the charts, can you believe the EURUSD has secured over six consecutive weeks of gains against the Greenback? Prices have jumped over 700 pips since mid-June, hitting a fresh 2020 high above 1.1910 before slipping back below 1.1900.
It looks like bulls remain in control on the weekly timeframe as there have been consistently higher highs and higher lows. Prices are trading above the 20 Simple Moving Average while the MACD has also crossed to the upside. A decisive breakout above 1.1900 could inspire a move higher towards 1.2000.
If 1.1900 proves to be reliable resistance, the EURUSD could pullback towards the 1.1700 support level.
Zooming in, the daily timeframe illustrates a similar picture to the weekly. It’s all about the 1.1900 resistance level. If this level is breached, bulls may try their luck with 1.2000 which seems like a tough nut to crack. The last time the EURUSD traded around those levels was all the way back in May 2018….
For those who enjoy the shorter timeframes, on the four hourly charts, some fatigue seems to be kicking in. This could trigger a small pullback lower before bull’s charge towards 1.1900. An intraday breakdown below 1.1820 may spark a decline lower in the short term.
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