*OspreyFX would like to state that traders should research extensively before following any information given hereby. Please read our Risk Disclosure for more information.
EUR/USD Outlook Talking Points:
- Currently waiting for the next short-term catalyst.
- Selling pressure in the horizon with bulls looking for a rally.
EUR/USD Outlook: waiting for the next short-term catalyst
The common currency displayed another bearish day at the start of the week, consolidating its price action below the 1.1020 level. This arrives following a strong resistance found around the 200 SMA at 4H chart, close to the key resistance at 1.1102.
Such an area has provided a strong dynamic hurdle that caps further gains in the EUR/USD pair. Currently, the spot is still trading around the lows from November 14th. The nearest support level lies at 1.1014, which is being challenged, and the bears are looking forward to breaking it during the upcoming hours.
Subscribe to our newsletter to receive our weekly updates + more straight to your inbox!
Selling pressure ahead
If this occurs, further declines are expected to take place to reach the 1.0946 neighbourhood. If the bearish bias clears such level, all eyes will be on the lows from October at 1.0880.
That move could extend the downside for several weeks, as the death cross of the moving averages will remain alive. Proof of this is the dynamic resistance provided by the 200-4hr SMA across the board. Furthermore, selling pressure could be coming once the pair consolidates below the 1.1000 handle.
Bulls will look for 1.1177
On the upside, the 1.1102 area is the next line in the sand for the bulls. If it gives up in favour of the bullish trend, a rally is likely to happen towards 1.1177. A level which has been capping attempts at going higher.
If such a level breaks, then another leg higher could extend the bullish bias to test the 1.1230 level. Beyond that figure, the quote could spike towards the 1.1280 region, but to confirm the upside’s dominance, EUR/USD should make a golden crossover.
Technical oscillators are still in the negative territory, with the RSI indicator hovering around the oversold territory and momentum slightly pointing upwards.