EUR/USD outlook: EUR/USD eyes fresh direction signals from fundamentals as technical studies are mixed

Slobodan Drvenica Windsor Brokers

EUR/USD

EURUSD is consolidating under new one-week high, posted after Thursday’s 0.8% jump.

Fresh advance broke again above Fibo resistance at 1.0563 (38.2% of 1.0936/1.0332), after last week’s recovery stalled at this zone, despite registering a weekly close above 1.0563.

Signals on daily chart are mixed, with 14-d momentum entering negative territory and conflicting MA’s, but countered by developing positive signal on weekly chart, following a bear trap under 1.0405 Fibo level (50% retracement of 0.9535/1.1275) and subsequent bounce.

However, confirmation of bullish signal will require not only repeated weekly close above 1.0563, but extension above former recovery top (1.0593) and violation of next key barrier at 1.0634 (50% retracement / daily Kijun-sen).

Otherwise, repeated upside failure would keep the downside vulnerable, with close below 1.0563 to weaken near-term structure and risk test of lower pivot at 1.0511 (daily Tenkan-sen) loss of which will be bearish.

From the fundamental side, unexpected drop in German Industrial production in October and Eurozone Q3 GDP in line with forecasts, did not have significant impact on the single currency, with focus shifting on US NFP data for possible stronger direction signal..

Res: 1.0597; 1.0609; 1.0634; 1.0682.
Sup: 1.0563; 1.0511; 1.0475; 1.0424.

Interested in EUR/USD technicals? Check out the key levels

1. R3 1.0695
2. R2 1.0642
3. R1 1.0613
PP 1.0561
1. S1 1.0531
2. S2 1.0479
3. S3 1.0449

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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