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EUR/USD Recovers, But Key Resistance Intact

Key Highlights

  • EUR/USD traded as low as 1.1781 before starting an upside correction.
  • It traded above a major bearish trend line with resistance near 1.1840 on the 4-hours chart.
  • GBP/USD climbed higher nicely above 1.3850, but it could struggle near 1.3950.
  • Crude oil price started a fresh increase after a short-term correction to $71.00.

EUR/USD Technical Analysis

The Euro extended its decline below the 1.1820 support against the US Dollar. EUR/USD traded as low as 1.1781 before starting an upside correction.

Looking at the 4-hours chart, the pair was able to recover above the 1.1820 resistance level. There was a break above a major bearish trend line with resistance near 1.1840.

The pair even traded above the 50% Fib retracement level of the key decline from the 1.1975 swing high to 1.1781 low. It is now facing resistance near the 1.1900 zone and the 100 simple moving average (red, 4-hours).

The next major resistance is near the 1.1930 level. It is near the 76.4% Fib retracement level of the key decline from the 1.1975 swing high to 1.1781 low. Any more gains could lead the pair towards the 1.1975 and 1.2000 resistance levels.

If not, EUR/USD could start a fresh decline below the 1.1850 level. The first key support is near 1.1820, below which there is a risk of more losses below the 1.1781 low.

Looking at GB/USD, there was a strong recovery wave above the 1.3850 resistance, but the pair is still trading well below the main 1.4000 resistance.

Economic Releases

German Wholesale Price Index for June 2021 (MoM) – Forecast +1.1%, versus +1.7% previous.

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