Key Highlights
- The Euro recovered recently and traded above the 1.1350 resistance against the US Dollar.
- There is a key connecting bearish trend line in place with resistance at 1.1460 on the 4-hours chart of EUR/USD.
- The US Industrial Production in Oct 2018 increased 0.1%, less than the +0.2% forecast.
- Today in the US, the NAHB Housing Market Index for Nov 2018 will be released, which is forecasted to remain at 68.
EURUSD Technical Analysis
The Euro declined towards the 1.1220 support area where buyers appeared against the US Dollar. The EUR/USD pair recovered and traded above the 1.1300 and 1.1320 resistance levels.
Looking at the 4-hours chart, the pair gained traction above the 1.1320 resistance and the 50% Fib retracement level of the last decline from the 1.1500 swing high to 1.1215 low.
More importantly, the pair settled above the 1.1350 resistance and the 100 simple moving average (red, 4-hours). However, the pair is now approaching a solid resistance near the 1.1460 level, which was a support earlier and now it could stop the current upward move.
Moreover, there is a key connecting bearish trend line in place with resistance at 1.1460 on the same chart. The same trend line is positioned along with the 200 simple moving average (green, 4-hours).
Finally, the 76.4% Fib retracement level of the last decline from the 1.1500 swing high to 1.1215 low is around the 1.1440 level. Therefore, the 1.1460 resistance zone is very crucial. A successful break above the trend line, 200 SMA, and the 1.1460 resistance will most likely clear the path for more gains in the near term.
Alternatively, if the pair fails to settle above the 1.1460 resistance, it could start a fresh decline. An initial support is near the 1.1350 level and the 100 SMA. Besides, there is a major bullish trend line in place with support at 1.1350.
Below the trend line and 1.1350, the pair could drop heavily towards the 1.1300 and 1.1280 levels.
Economic Releases to Watch Today
- Euro Zone Construction Output Sep 2018 (YoY) – Forecast +2.4%, versus +2.5% previous.
- Euro Zone Construction Output Sep 2018 (MoM) – Forecast +0.1%, versus -0.5% previous.
- US NAHB Housing Market Index Nov 2018 – Forecast 68, versus 68 previous.
