EUR/USD draw back stalls as greenback rally pauses for breath

And that comes after a key check of the 1.0500 mark final week, with the significance of the extent underlined right here. The bounce this week sees the pair nudge up nearer to 1.0600 however can be pausing somewhat since in a single day buying and selling. That coincides with the 23.6 Fib retracement stage of the swing decrease this month, additionally seen on the determine stage.

Moreover that, affords layered on the 1.0600 mark are additionally in play for now and that’s holding the bounce in verify. Seeking to the near-term chart although:

We will extra clearly see how the greenback momentum has stalled. That contemplating worth motion has now moved again above its 100-hour shifting common (crimson line). As such, the near-term bias is now extra impartial with worth holding above that however beneath its 200-hour shifting common (blue line). The latter is seen at 1.0633 at present. So, there may be some slight room for worth to increase larger earlier than any risk to completely reversing the promoting momentum.

As such, sellers i.e. greenback bulls can have a transparent near-term stage to defend within the periods forward to maintain the post-election momentum.

This can be a comparable state to different greenback pairs, together with GBP/USD, USD/CHF, USD/CAD, AUD/USD, and NZD/USD. All are seeing their worth motion maintain in between the respective near-term ranges as outlined in EUR/USD above as nicely.

That factors to a pause within the greenback rally as merchants catch their breath following the post-election run. We’re now within the interval of reassessing that with Treasury yields additionally stalling following the current upside. The most effective gauge in making sense of those momentum shifts can be to take a look at the charts as per the above.

This text was written by Justin Low at www.ubaidahsan.com.



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