EUR/USD (daily chart) has tentatively stalled its climb of the last few weeks just under a strong resistance confluence. The confluence factors include both the important 1.3000 level and a long-term bearish resistance trend line extending back to the May 2011 1.4937 high. Price has been consolidating under this resistance confluence for the entire trading week thus far. Because of the significance of this 1.3000 resistance, any bullish move that is able to break out above it could carry the upside momentum to extend the short-term uptrend, with near-term potential resistance around the 1.3170 level. Further to the upside resides the key 1.3500 level, which could potentially serve as a further resistance point. In the event that 1.3000 resistance holds, key downside support on a bearish correction potentially resides around the 1.2800 level.
James Chen, CMT
Chief Technical Strategist
FX Solutions
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