The Euro was among the weakest US Dollar rivals on Thursday, with EURUSD bottoming at 0.9935 ahead of the release of the US Consumer Price Index (CPI). Generally speaking, financial markets saw little action ahead of the release, with European indexes trading mixed around their opening levels and US Treasury yields ticking marginally lower.

The daily chart for the EURUSD pair shows that the pair is once again above a bearish 100 SMA,  currently at around 1.0040 and providing dynamic support. The 20 SMA keeps advancing below the longer one, while technical indicators picked up upward pace near overbought readings, supporting another leg north.

The 4-hour chart shows that the pair briefly fell below a bullish 20 SMA, which keeps advancing above the longer ones. Technical indicators, in the meantime, turned firmly higher into positive territory, reflecting the sharp post-CPI rally. A critical level to watch is 1.0188, October monthly high, as once beyond it, bulls will seize control of the pair.

If spot accelerates losses, it could then challenge the 55-day SMA, today at 0.9888, prior to another visit to the 9-month support line around 0.9840. Below the latter, the pair could see the near-term bearish outlook reinstated.

In the longer run, the pair’s bearish view should remain unaltered while below the 200-day SMA at 1.0442.

The downtrend may be expected to continue, while market is trading below resistance level 1.0131, which will be followed by reaching support level 0.9760 and 0.9595.

The downtrend may be expected to continue, while market is trading below resistance level 1.0054, which will be followed by reaching support level 0.9935 and 0.9675.

EURUSD completing wxyxz correction

Nov 10 2022