- The bias is bearish as long as it is below the upper median line.
- US economic data should bring strong action.
- A breakout from the upper channel signaled a new leg down.
EUR/USD is trading at 1.0838 at the time of writing. The pair looks positive to approach new highs as the US dollar remains weak.
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The dollar depreciated as expected as US preliminary GDP and merchandise trade balance fell in the last trading session.
Today, German retail sales fell 0.4%, despite traders expecting a 0.5% rise, while Germany’s jobless change came in better than expected, at 11k above an estimated 6k. German Prelim CPI is also due out today.
Later, US economic data should have a big impact. The core PCE price index may announce an increase of 0.4% after an expected increase of 0.2%.
Jobless claims could jump from 201,000 to 209,000, the Chicago PMI could be reported at 48.1 points, up from 46.0 points in the previous reporting period, while pending home sales could post a 1.4% gain in January after growth of 8.3% in December.
In addition, data on personal consumption and personal income will be published.
Technical analysis of EUR/USD price: Bullish Momentum
From a technical point of view, the price of EUR/USD has risen after the last strong sell-off. In the short term, a smaller jump was natural.
The price went as high as 1.0854, where it found a strong offer. As you can see on the hourly chart, the price has escaped from the upward channel pattern, indicating a new downward leg.
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It retested the supply zone below 1.0860 and below the upper middle line of descending villas (uml). The pair could fall again if it remains below the upper middle line (uml). The removal of this dynamic resistance confirms further growth.
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