The EUR/USD pair gains some follow-through traction on the last day of the week and inches back closer to a multi-month top set on Monday.

The pair is testing the resistance level. The instrument is going above the Ichimoku Cloud, which suggests an uptrend. A test of the upper border of the Cloud at 1.0485 is expected, followed by growth to 1.0805. An additional signal confirming the growth will be a bounce off the lower border of the bullish channel. The scenario can be cancelled by a breakaway of the lower border of the Cloud and securing under 1.0355, which will mean further falling to 1.0265.

The major currency pair’s run-up could be well-linked to the bull cross on the Daily chart as the 50-day Exponential Moving Average (EMA) crosses the 100-day EMA from below. Also favoring the buyers is the firmer RSI (14) and the absence of the bearish MACD signals. That said, the EUR/USD pair stays firmer inside a one-month-old ascending triangle.

However, sluggish MACD and the nearly overbought RSI conditions highlight the likely pullback of the major currency pair from the monthly triangle’s resistance line, close to 1.0630 by the press time.

In a case where the EUR/USD bulls cross the 1.0630 hurdle, the 1.0700 threshold and June’s peak surrounding 1.0775 should return to the chart.

On the contrary, a downside break of the stated triangle’s support line, near 1.0465 at the latest, could quickly drag the quote toward the 200-day EMA level of 1.0395.

However, the 50-day EMA and the 100-day EMA could challenge the EUR/USD bears afterward, around 1.0215 and 1.0190 in that order.

EURUSD Gaining Ground For Continuation of Rally

Dec 10 2022