EURUSD maintains a neutral bias since August 28 but the underlying bullish trend still holds firm from the April low of 1.0820.
The short-term technicals are neutral and indicating that upside momentum has weakened. RSI and MACD are both still in bullish territory although the indicators have been heading lower during the past two weeks. This could suggest that EURUSD remains at risk of weakening further especially after the pair’s inability recently to make strong headway through resistance at the September 8 high of 1.2091.
More range trading seems the most likely prospect for EURUSD in the near term but a break below the 1.1900 support would shift the focus to the downside for a move towards support at 1.1661 (August 17 low). A deeper fall would target a previous resistance-that-could-turn-support zone at 1.1471. Falling below this level would see the market retrace more than 50% of the 1.0820 – 1.2091 uptrend and likely move lower to 1.1290 and then 1.1100 before reversing the whole uptrend.
Trend indicators are painting a bullish picture, with the 50-day and 200-day moving averages being positively aligned. The underling bullish trend remains intact but upside momentum has stalled. A sustained break above 1.2091 is needed to see a resumption of the uptrend with scope to rise to the 1.2400 area. In the near term, more range trading is expected but there is risk for a move to the downside.