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EUR/USD Nears A Turning Point After Prolonged Consolidation

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Aayush Jindal

Key Highlights

  • EUR/USD started a consolidation phase above the 1.1120 support.
  • A possible bullish flag is forming with resistance at 1.1240 on the 4-hour chart.
  • GBP/USD might aim for a fresh increase if it clears the 1.3420 resistance.
  • Gold prices extended losses and declined below $4,000.

EUR/USD Technical Analysis

The Euro found support near 1.1120 against the US Dollar. EUR/USD started a recovery wave and climbed above the 1.1180 resistance.

Looking at the 4-hour chart, the pair even cleared 1.1220 and tested 1.1270 before the bears appeared. There was a minor pullback below 1.1250, and the pair started trading in a range. It tested the 50% Fib retracement level of the recovery wave from the 1.1113 swing low to the 1.1269 high.

The pair is now trading near the 100 simple moving average (red, 4-hour) and is below the 200 simple moving average (green, 4-hour). If there is another increase, the pair could face resistance near 1.1240. There is also a possible bullish flag forming with resistance at 1.1240.

The first major resistance might be near 1.1270. A close above 1.1270 could start a steady increase. In the stated case, the pair might even surpass 1.1320. The main hurdle could be near the 200 simple moving average (green, 4-hour) at 1.1350.

Conversely, the pair could see another decline. Immediate support could be 1.1190. The first major support might be 1.1150. A close below 1.1150 might accelerate the decline. In the stated case, the pair might drop to 1.1100. The main support might be close to 1.1050.

Looking at Gold, the price is showing some bearish signs, and there could be a move toward the $3,880 support.

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