The Euro remains at the front foot in early Wednesday’s trading and attempts again towards key barriers provided by daily cloud top, 100SMA and 50% retracement of 1.1448/1.1107 fall (1.1277/79) where Tuesday’s attack was strongly rejected. The Euro regained traction after dipping to 1.1226 (Tuesday’s low) as dollar weakened further on dovish signals from top Fed officials.
Fed Chairman Powell changed his rhetoric from patient approach to rate decision, saying that the central bank will respond as appropriate on rising risk to trade and global growth.
Strong bullish momentum on daily chart justifies the bullish stance, but overbought stochastic and sideways-moving RSI sour the sentiment and warn of possible repeated upside rejection.
The pair may hold in extended consolidation in case bulls fail again to clear 1.1277/79 pivots, with bullish bias in play while the price holds above broken 55SMA (1.1217). Strong bearish signal can be expected on sustained break below 55 SMA and daily cloud base (1.1202). Bullish scenario requires firm break higher to signal continuation and expose 1.1318/23 (Fibo 61.8%/mid-Apr lower platform. Services PMI’s from EU members are among key data from the Eurozone today and may provide fresh signals, although forecasts are in line with previous releases.
Res: 1.1279, 1.1323, 1.1367, 1.1373
Sup: 1.1250, 1.1237, 1.1217, 1.1202
