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EUR/USD Approaches Key Support, Dollar Could Resume Losses

Aayush Jindal

Aayush Jindal

Key Highlights

  • EUR/USD started a downside correction from the 1.0930 level.
  • It traded below a key bullish trend line with support at 1.0810 on the 4-hours chart.
  • GBP/USD is consolidating gains above the 1.2200 support zone.
  • USD/JPY extended losses below the 130.50 support zone.

 

EUR/USD Technical Analysis

The Euro started a major increase above the 1.0750 resistance against the US dollar. EUR/USD even climbed above 1.0900 before it started a downside correction.

Looking at the 4-hours chart, the pair traded as high as 1.0929 before it faced sellers. There was a drop below the 1.0850 and 1.0820 support levels. The pair even traded below a key bullish trend line with support at 1.0810.

However, the pair is still above the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours). On the downside, an immediate support is near the 1.0750.

The next major support is near the 1.0720 level, below which there is a risk of a move towards the 100 simple moving average (red, 4-hours). Any more losses might open the doors for a fresh decline towards the 1.0520 level.

An immediate resistance on the upside is near the 1.0820 level. The first major resistance is near the 1.0850 level. The next major resistance is near the 1.0865.

A clear move above the 1.0865 resistance might send the pair towards the 1.0920 zone. Any more gains might send the pair towards 1.0980 or even 1.1000.

Looking at GBP/USD, the pair is holding gains above the 1.2200 level and might attempt a fresh increase in the near term.

Economic Releases

  • German IFO Business Climate Index for March 2023 – Forecast 90.9, versus 91.1 previous.
  • German IFO Current Assessment Index for March 2023 - Forecast 94.1, versus 93.9 previous.