EUR/USD Breaks Over Descending Triangle – Eyes On US Non-farm Payrolls!
Arslan Butt • 2 min read
The direct currency pair EUR/USD has violated the descending triangle pattern at the 1.1248 level, and it is now heading north, to test the next target level of 1/1287. It seems like the investors are doing profit-taking in the U.S. dollar, which is making it weaker against most of the currencies.
Despite the intensifying fears of a second wave of the coronavirus, coupled with geopolitical concerns, the broad-based U.S. dollar failed to extend its previous session gains and remains depressed on the day, possibly due to the modest upbeat trading sentiment backed by the hopes of further stimulus and an upbeat outcome of the global PMIs. The reason for the declines in the U.S. dollar could also be attributed to the reports of another vaccine trial, which showed positive results for COVID-19.
However, the greenback losses could be short-lived or temporary, if coronavirus concerns overshadow the upbeat U.S. data and keep the equities in the red. This said, the losses in the U.S. dollar have turned out to be one of the key factors that have kept the currency pair higher today. Looking forward, the market participants will be keeping their eyes on the key U.S. employment figures for June before forecasting any near-term moves. And the virus/trade updates might not lose their importance.
Daily Support and Resistance
Pivot Point 1.1238
The EUR/USD is consolidating in a wide trading range of between 1.1350 to 1.1195, and trades are bullish at around 1.1300. The EUR/USD pair has violated the descending triangle pattern, and it is now trying to farm a W pattern on the 4-hour timeframe. The recent bullish engulfing candle on the hourly chart is exhibiting the potential to target the 1.1340 mark. The RSI and 50 periods of EMA are supporting the buying trend. Let’s look at buying trades over the 1.12600 level today, but before the release of the NFP data. Good luck!