The Euro lost traction on Friday following comments from ECB President Lagarde who said that it is still too early to discuss policy after the end of central bank’s emergency bond-buying scheme and seeing inflation rise this year as temporary, that offset positive signals from upbeat EU PMI data, released earlier today.
Near-term action remains congested for the fourth consecutive day, with fading bullish momentum and south-turned daily RSI and stochastic, signaling that near-term structure is weakening.
Failure to register weekly close above cracked Fibo barrier at 1.2197 (76.4% of 1.2349/1.1704) would add to negative signals, as initial signal of bull-trap pattern forming on the weekly chart would be generated.
Rising 10DMA (1.2152) which reinforced the current range floor, turned sideways and also warning for deeper pullback.
Caution on a close below 10 DMA that would risk test of key supports at 1.2120/13 (bull-trendline off 1.1704 low / rising 20DMA.
Res: 1.2197; 1.2234; 1.2300; 1.2349.
Sup: 1.2171; 1.2152; 1.2113; 1.2102.