EUR/USD has surely been an adventurous ride for traders in the past few weeks. While the trend has mostly been bearish with the market dropping down to around 1.09, a level that was last seen in the first half of the year 2017, the pair has been retracing slowly for the past few days. EUR/USD is currently trading at 1.0986 which depicts a daily gain of 0.1%.
100 – Candle Moving Average (MA) Indicator
But is there going to be a further upward rally this week that significantly recovers the losses of the last week? Such is a question that has the potential to shape the weekly strategies of the investors. According to the 100-candle moving average (MA) indicator applied to the 4-hour chart, EUR/USD is currently challenging a strong resistance at 1.0991 level. An overview of the last few days shows that 1.0991 is a level that has been recently tested two times and the market failed both the times to break above it.
In light of that, if the pair closes above 1.0991 on a 4-hour chart, it will most certainly hint at the rising bullish inclination among the traders. The next key level to watch once 1.0991 has been broken is located at 1.1025. These technical levels are clearly visible as per the trend line that connects the previous two highs of June 25th and August 13th. In an event that the market closes above the trend line on the daily chart, it will be construed as the potential end to an extended bearish trend of EUR/USD.
On the downside, however, if the market fails to break the 1.0991 level for the third time, a drop back to the previous 1.0920 level is in sight.
Major Market Movers This Week
All in all, analysts have predicted it to be an exciting week for the traders with multiple market movers to unfold throughout the week. The ongoing events circling the U.S – China trade war, specifically the negotiations being held on Thursday and Friday, is expected to have market implications in the short as well as in the long run.
Other than that, the FOMC meeting minutes and ECB monetary policy meeting accounts, on Wednesday and Thursday respectively, will surely manifest as higher volatility in the Forex market, particularly in the EUR/USD pair. Lastly, the monthly consumer price index (CPI) and crude inventories are also expected to shed some light on the overall strength of the U.S dollar in the international market.
In the short term, however, traders must keep their focus on the approaching 1.0991 level for now. Whether the pair breaks above or respects this key technical resistance will indicate the market’s intention for the upcoming days.