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The Euro bulls are back: targets to eye

Commentaries & Views

EUR/USD

The euro has recently rebounded, and the pair is approaching resistance after swift Friday’s action. Will the bulls be strong enough to overcome it – and if so, where exactly can their efforts take them?

These were our Friday’s observations:

(…) The EUR/USD bears were stopped at the combination of the green support zone based on mid-Oct lows and the 61.8% Fibonacci retracement yesterday. A rebound followed, resulting in the exchange rate invalidating the earlier tiny breakdown below these supports.

This suggests further improvement, especially when we factor in the buy signals generated by the daily indicators.

Should it be the case and the pair extends gains from here, we’ll see at least an increase to the previously broken lower border of the declining grey trend channel in the coming week.

The situation indeed developed in line with the above, and EUR/USD has reached the first above-mentioned upside target.

Then, both the CCI and the Stochastic Oscillator generated their buy signals, increasing the likelihood of further improvement in the very near future – even if we see a small pullback from current levels first.

Nevertheless, if the bulls prove strong enough to break higher, the way to the upper border of the grey channel (or even recent peaks) may be open.

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