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EUR/USD Recovery Builds Slowly As Traders Eye Breakout Potential

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Aayush Jindal

Key Highlights

  • EUR/USD dipped further before the bulls appeared near 1.1575.
  • It traded above a bearish trend line with resistance at 1.1610 on the 4-hour chart.
  • GBP/USD climbed higher above the 1.3450 resistance zone.
  • Gold started a consolidation phase above the $4,450 support.

EUR/USD Technical Analysis

The Euro remained in a bearish zone below 1.1720 against the US Dollar. EUR/USD even dipped below 1.1620 before the bulls appeared.

Looking at the 4-hour chart, the pair traded as low as 1.1576 and recently started a recovery wave. The pair climbed above the 23.6% Fib retracement level of the downward move from the 1.1787 swing high to the 1.1576 low.

Besides, the pair traded above a bearish trend line with resistance at 1.1610. On the upside, the pair faces resistance at 1.1655. The first major resistance could be 1.1685, the 100 simple moving average (red, 4-hour), the 200 simple moving average (green, 4-hour), and the 61.8% Fib retracement level of the downward move from the 1.1787 swing high to the 1.1576 low.

A close above 1.1700 could open doors for gains above 1.1720. In the stated case, the bulls could aim for a move to 1.1800. If there is another decline, the pair could find bids near 1.1600.

The first major support sits near the 1.1575 level. The next support could be 1.1550. A close below 1.1550 might initiate a drop to 1.1500. Any more losses might open the doors for a drop toward the 1.1465 zone.

Looking at GBP/USD, the pair started a decent increase and was able to clear the 1.3450 resistance zone.

Upcoming Key Economic Events:

  • ECB's Sleijpen speech.
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