EUR/USD is Facing Uphill Task Near 1.1620

Key Highlights

  • The Euro started an upside correction after trading as low as 1.1432 against the US Dollar.
  • There was a break above a major bearish trend line with resistance at 1.1500 on the 4-hours chart of EUR/USD.
  • The Euro area Industrial Production in August 2018 increased 0.9%, better than the -0.2% forecast.
  • Today, the US Retail Sales for Sep 2018 will be released, which is forecasted to increase 0.3% (MoM).

EURUSD Technical Analysis

The Euro declined heavily below 1.1500 before buyers appeared around 1.1430 against the US Dollar. The EUR/USD pair traded as low as 1.1432 and later started a decent upside correction.

EURUSD Technical Analysis Euro US Dollar

Looking at the 4-hours chart, the pair traded above the 1.1480 and 1.1500 resistance levels. More importantly, there was a break above a major bearish trend line with resistance at 1.1500.

Later, the pair climbed above the 1.1550 resistance area, but it faced a strong selling interest near the 1.1600-1.1610 zone. Moreover, the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours) are also positioned near the 1.1620 zone.

Therefore, the Euro buyers are likely to face a strong resistance near the 1.1600-1.1620 zone. If there is a daily close above 1.1620 and both SMA’s, there could be a decent upward move towards the 1.1750 level in the near term.

On the other hand, if the pair fails to clear the 1.1620 resistance, there could be a downside move towards the 1.1500 support area. Below 1.1500, the next major support is positioned near the 1.1465 level.

GBP/USD also moved higher above the 1.3200 level, but it failed to hold gains above 1.3240 and later corrected lower. On the other hand, USD/JPY started a major downside correction and declined below the 113.00 and 112.50 support levels.

Economic Releases to Watch Today

  • US Retail Sales Sep 2018 (MoM) – Forecast +0.5%, versus +0.1% previous.
  • US Retail Sales ex Autos Sep 2018 (MoM) – Forecast +0.3%, versus +0.3% previous.

Aayush Jindal

Aayush is a Senior Forex, Cryptocurrencies and Financial Market Strategist with a background in IT and financial markets. He specialises in market strategies and technical analysis, and has spent over a decade as a financial markets contributor and observer. He possesses strong technical analytical skills and is well known for his entertaining and informative analysis of the currency, commodities, Bitcoin and Ethereum markets.

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