- EUR/USD has pushed 0.50% higher at the start of the week.
- The risk theme has improved and the dollar has seen a decline across the board.
EUR/USD 4-hour chart
EUR/USD has pushed back into the old consolidation range as the US dollar has lost ground on Monday. The news that Donald Trump is recovering has spurred the risk appetite of investors and traders and led to the pair moving higher. There have also been some interesting comments from the Eurogroup as the Head said “we will continue to monitor the Euro exchange rate”.
Looking at the chart, the price has moved higher and broken the trendline to move back above an important level at 1.1762. This was the consolidation support zone that the price bounced off the most times before breaking lower.
Now the next significant support is the mean value area of the consolidation which is the red line at 1.1829. This area has been a magnet for the price and could be significant once again to make a higher low if the price makes it there. If the level is broken then a test of the high on the chart at 1.2011 could be on the cards.
It seems obvious but the indicators are once again looking positive. The Relative Strength Index is back in the overbought area and the MACD signal lines are above zero along with the histogram.
Overall the trend is very much an uptrend. When the consolidation low broke to the downside it was fair to assume that the trend might be reversing. Now if the red resistance level breaks the opposite could be true again and the uptrend may resume with 1.20 the main target for the bulls.
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