- EUR/USD was seen oscillating in a range through the early North American session on Monday.
- The recent range-bound trading action warrants some caution before placing directional bets.
The EUR/USD pair lacked any firm directional bias and seesawed between tepid gains/minor losses through the early North American session on Monday. The downside remained cushioned near 200-period SMA on the 4-hourly chart, around the 1.0870 region.
The mentioned area marks the mid-point of a multi-week-old trading range, which should now act as a key pivotal point for short-term traders. A convincing breakthrough might be seen as a fresh trigger for bearish traders and prompt some technical selling.
This, in turn, will set the stage for an extension of the pair’s recent pullback from the vicinity of 200-day SMA – levels just above the key 1.1000 psychological mark. The downfall could get extended towards the 1.0800 mark en-route the 1.0775 horizontal support.
The latter coincides with the lower end of the mentioned trading range, which if broken decisively, should pave the way for slide further towards the 1.0700 mark. The pair could fall further and bears might then aim to retest YTD lows, around the 1.0635 region.
Conversely, any meaningful positive move beyond the 1.0900 mark now seems to confront some fresh supply near the 1.0950 region. This is closely followed by a resistance marked by the top end of the trading range, around the 1.0975-80 region.
Some follow-through buying beyond the mentioned barrier, leading to a sustained strength above the 1.1000 mark will confirm a near-term bullish breakout and lift the pair further towards an intermediate resistance near the 1.1040-50 region.
EUR/USD 4-hourly chart
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Technical levels to watch
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