EURUSD is showing some positive signs in the short-term after the rebound off the 22-month low of 1.0805. Currently, the market is consolidating within the 20- and 40-day simple moving averages (SMAs), while the technical indicators are suggesting more upside movements. The RSI is trying to overcome the neutral threshold of 50 and the MACD is strengthening its positive momentum above its trigger line in the negative region.
If the market manages to pick up speed, the 40-day (SMA) at 1.1113 could offer nearby resistance ahead of the 1.1185 resistance level. A significant close above the latter, the next obstacle could come from the descending trend line around 1.1220, while more increases would raise chances for an up-trending market. In this case, prices could climb towards the 1.1275 barrier.
Should prices decline, immediate support could be found around the 20-day SMA at 1.1016 from October to December. Then a leg below that level, the pair could meet the 1.0940 support before tumbling to the 22-month low of 1.0805.
In the long-term, the outlook remains negative since prices hold below the descending trend line. However, in the short-term picture, EURUSD is creating a bullish correction.
