EUR/USD Recovers from Three-Week Low, Faces Key Resistance at 1.0980

The EUR/USD pair finds itself at its lowest level since July 07, but it shows signs of bouncing back as it rebounds from a descending support line that has been in place for three weeks. The current level hovers around 1.0940.

This recovery is influenced by factors such as the oversold Relative Strength Index (RSI) at 14, as well as market sentiment regarding inflation and employment data from both the Eurozone and the US. Additionally, the recent strength in S&P500 Futures and a retreat in Treasury bond yields have contributed to the EUR/USD pair consolidating its recent losses.

Nevertheless, bearish sentiment persists for EUR/USD unless the quote manages to break above the support-turned-resistance line, which currently stands at 1.0980.

If the EUR/USD price surpasses 1.0980, it may draw attention to the 38.2% Fibonacci retracement level of its May-July upside, located near 1.1040, and the upper boundary of the falling wedge pattern, close to 1.1065.

A further upward move beyond 1.1065 could lead the pair towards the previous monthly high at 1.1275, with a theoretical target of the falling wedge breakout at 1.1420 potentially enticing Euro buyers thereafter.

On the downside, the bottom boundary of the falling wedge pattern offers support at approximately 1.0910, followed by the 61.8% Fibonacci retracement level at 1.0880 and the previous monthly low around 1.0835.

In summary, the EUR/USD pair shows signs of recovery but faces a critical hurdle at 1.0980, with further resistance levels to overcome for a sustained bullish momentum. Conversely, the falling wedge’s lower boundary acts as a support, and a break below it might lead to additional downside pressures.

ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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