The Euro dips in European session on Wednesday after reversal pattern was formed on daily chart but attempts to extend recovery stalled on approach to pivotal Fibo barrier at 1.2166 (38.2% of 1.2349/1.2053 bear-leg), capped by falling 10DMA (1.2155).
Fundamentals remain positive for the single currency as recent upbeat data from Germany point to economic recovery and new US stimulus package is expected to boost risk sentiment.
On the other side, technical studies on daily chart remain negatively aligned ( rising bearish momentum / multiple MA bear-crosses) and weigh on near-term action, but bear-trap under 1.2064 Fibo support and rising daily cloud continue to underpin, making mixed signals.
Near-term bias is expected to remain with bulls while the action holds above 1.2123/11 (broken Fibo 23.6% of 1.2349/1.2053 / 5DMA) but clear break of 1.2166 pivot is needed to confirm positive stance.
Break and close below 5DMA would increase risk of retesting key Fibo support at 1.2064, loss of which would signal extension of pullback from 1.2349 (2121 high).
Res: 1.2155, 1.2166, 1.2186, 1.2201.
Sup: 1.2111, 1.2073, 1.2064, 1.2053.
