The EUR has risen towards the 1.3340 level as traders react to the poor US trade deficit number.
The USD trade deficit widened to $48.73 billion in November and a deficit of $42.06 billion in October. This was way above the consensus of $41.30 that was expected.
We are now tocuhing the resistance level at 1.3345, which if breached would open up the next level at 1.3370. The target is now looking to be the 1.3450 area. Support is at 1.3390, then 1.3365.
Technically hourly RSI is above 75 signalling an overbought situation but the market mentality is clearly to buy at the moment. Daily RSI approaching 70 as well, so we may see some retracement if the market stalls at these levels.
Further reading: Forex Analysis: EUR/USD Rebounds Off Key Support Confluence
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