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FOREX: EURUSD Back Above 1.0400, Monitoring Clear Break of Trendline Resistance

FOREX
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  • EURUSD has been trading with a supportive tone across the US session and has risen back above 1.0400 in latest dealings. Elevated levels for major equity indices have likely been supportive of the broader dollar offer, while the lack of concrete details on tariffs for Eurozone countries may be bolstering the single currency relief rally.
  • We have noted that the bounce so far appears corrective in nature, however, the latest bullish developments are being monitored closely. Most notably, the pair has breached the 20-day EMA, at 1.0346, and pierced trendline resistance at 1.0393, drawn from the Sep 30 ‘24 high.
  • A clear breach of the line would expose the 50-day EMA at 1.0461, which closely coincides with the October 2023 low of 1.0448. Clearance of these levels would strengthen a bullish condition and would signal scope for a greater recovery to 1.0568, the Dec 10 high.
  • Aside from Trump related risks, the Eurozone data calendar is headlined by the January flash PMIs on Friday. Data will help set the tone for sentiment heading into 2025, with questions still remaining around the likely pace and magnitude of ECB rate cuts later this year.
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  • EURUSD has been trading with a supportive tone across the US session and has risen back above 1.0400 in latest dealings. Elevated levels for major equity indices have likely been supportive of the broader dollar offer, while the lack of concrete details on tariffs for Eurozone countries may be bolstering the single currency relief rally.
  • We have noted that the bounce so far appears corrective in nature, however, the latest bullish developments are being monitored closely. Most notably, the pair has breached the 20-day EMA, at 1.0346, and pierced trendline resistance at 1.0393, drawn from the Sep 30 ‘24 high.
  • A clear breach of the line would expose the 50-day EMA at 1.0461, which closely coincides with the October 2023 low of 1.0448. Clearance of these levels would strengthen a bullish condition and would signal scope for a greater recovery to 1.0568, the Dec 10 high.
  • Aside from Trump related risks, the Eurozone data calendar is headlined by the January flash PMIs on Friday. Data will help set the tone for sentiment heading into 2025, with questions still remaining around the likely pace and magnitude of ECB rate cuts later this year.