Forex Technical Update
The EUR/USD started the week continuing to consolidate. Last week's low at 1.3212 held and a gap to the upside formed to begin trading this week. The market also broke above a trendline as well as confirm a double bottom attempt before clearing the 133.20 pivot. As the market enters the US session, the 50% retracement level at 1.3390 to 1.34 psychological pivot is providing resistance.
The market lost short-term bearish momentum as the 1H RSI reading broke above 60. In the 4H chart however, the RSI reading still shows a bearish stance. If 1.34 does not provide a reversal back toward the bearish mode, there is a resistance cluster just above, near 1.3430, 61.8% retracement level, and 200 hour simple moving average. A break above suggests a possible end to the October decline.
An important support pivot is in the 1.33-1.3320 area. The correction rally might be over if the market can push back below this area. 1.3145 is the the next bearish target below the 1.32-1.3212 area.
Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources