EUR/USD Recovering But Approaching Resistance18 November, 2019 by Aayush Jindal in Market Analysis
- EUR/USD started an upside correction from the 1.0989 low and climbed above 1.1020.
- There are many hurdles on the upside such as 1.1065 and 1.1080.
- GBP/USD bounced back after a correction and climbed above 1.2880.
- The US NAHB Housing Market Index is likely to remain at 71 in Nov 2019.
EUR/USD Technical Analysis
After a steady decline, the Euro found support near the 1.1000 area against the US Dollar. As a result, EUR/USD started an upside correction and climbed above the 1.1020 resistance.
Looking at the 4-hours chart, the pair managed to settle above the 1.1000 and 1.1020 levels. Moreover, there was a break above a key bearish trend line with resistance near 1.1018.
The pair is now trading well above the 23.6% Fib retracement level of the downward move from the 1.1175 high to 1.0989 low. However, there are many hurdles waiting on the upside, starting with 1.1065 (the previous support area).
More importantly, the 100 simple moving average (red, 4-hours) is positioned near the 1.1080 level to act as a strong resistance. Besides, the 50% Fib retracement level of the downward move from the 1.1175 high to 1.0989 low is near the 1.1082 level.
Therefore, EUR/USD must climb above the 1.1065 and 1.1080 resistance levels to move back into a positive zone. The next key resistances are near 1.1120 and 1.1150.
Conversely, the pair could complete the current correction near 1.1065 or 1.1080 and start a fresh decrease. On the downside, the main supports are near 1.1020 and 1.1000 levels.
Looking at GBP/USD, the pair completed a downside correction close to 1.2820 and bounced back (as discussed in the last week analysis). Similarly, USD/JPY remained well supported near the 108.20 area.
Upcoming Economic Releases
- German Monthly Budget.
- US NAHB Housing Market Index Nov 2019 – Forecast 71, versus 71 previous.