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EUR/USD Bounce Runs Into Trouble As Resistance Strikes Back

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Aayush Jindal

Key Highlights

  • EUR/USD started a recovery wave and tested the 1.1675 resistance.
  • An expanding triangle is forming with resistance at 1.1675 on the 4-hour chart.
  • GBP/USD is still struggling to clear the 1.3550 resistance zone.
  • Gold could start a fresh decline unless it closes above $4,600.

EUR/USD Technical Analysis

The Euro found support at 1.1575 against the US Dollar. EUR/USD started a recovery wave above 1.1600 and 1.1620, but it faces many hurdles.

Looking at the 4-hour chart, the pair climbed above the 38.2% Fib retracement level of the downward move from the 1.1787 swing high to the 1.1576 low. However, the bears seem to be active near the key hurdle at 1.1675.

There is also an expanding triangle forming with resistance at 1.1675. It coincides with the 50% Fib retracement level of the downward move from the 1.1787 swing high to the 1.1576 low.

The pair is now trading below the 100 simple moving average (red, 4-hour) and the 200 simple moving average (green, 4-hour). To continue higher, it must settle above 1.1675.

The next major resistance could be 1.1700. A close above 1.1700 could open doors for gains above 1.1750. In the stated case, the bulls could aim for a move to 1.1800.

On the downside, the pair could find bids near 1.1620. The first major support might be 1.1600. A close below 1.1600 might initiate a drop to 1.1550. Any more losses might open the doors for a drop toward the 1.1420 zone.

Looking at GBP/USD, the pair is attempting to recover some losses, but it faces a major hurdle near the 1.3550 region.

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