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2014-03-07-EURUSD

March 7, 2014 – EUR/USD (daily chart) reached a new 2+ year high of 1.3914 in early trading on Friday before retreating after the dollar-strengthening US Non-Farm Payrolls report. This high slightly surpasses the previous long-term high of 1.3892 that was established at the end of 2013.

The upside breakout comes after a substantial rally on Thursday, and tentatively confirms a continuation of the generally bullish trend that has been in place since the July low near 1.2750. Within this uptrend, the past month has seen a rebound and steady rise from a pullback that hit a February low of 1.3475, near the key 38% Fibonacci retracement of the bullish trend.

Despite the slight pullback after the U.S. employment report, the general bias currently remains bullish for the EUR/USD. With follow-through on the breakout and continued momentum above 1.3900, the bullish trend would have its next major upside targets around the 1.4000 psychological level and then the 1.4250 resistance level. Key downside support on another pullback continues to reside around the 1.3700 level.

James Chen, CMT
Chief Technical Strategist
City Index Group

 

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