USD Bulls are back, what's next for EURUSD?

The US dollar got its bullish strength back against its G10 counterparts during the last week. It outperformed AUD, NZD, CAD, GBP, CHF, and EUR and it appeared that resistances and supports did not have any significance. It seems like investors, including large scale investment banks are back in the USD look as there is no development in Europe regarding the troubled Greek economy. As we said last week after the pair hit its 100% Fibonacci retracement zone at 1.1390, EURUSD rose almost as high as the high of February 2015, bouncing off the 1.1460 zone. The disappointing news came from Europe that there was no common agreement between the Greek PM Tsipras, German chancellor Merkel and the French President Hollande. It appears that only thing they did agree was the agreement to continue to talk while Greece has less than two weeks to pay a large payment to IMF

Technical outlook:

1- EURUSD could not break through its 1.15 psychological resistance level 2- The pair has bounced off the 1.1390 level, 100% Fibonacci retracement level and is now testing 1.10 psychological support zone 3- Technical indicators indicate possible continuation of the bearish movement as fundamentals are supporting stronger USD and weaker EUR

On weekly timeframe there is clear bearish rebound. The pair closed the weekly candle below its three week low at 1.1010 zone. MACD signal line is still below the MACD bars however RSI is sloping downwards. Our trend indicators 200, 50 and 5week SMAs are showing downwards which is a sign of bearish trend continuation.

Moving on to daily timeframe, we can see the strong support between 1.0810 – 1.1040 levels. Looking into our indicators and oscillators, MACD is above its zero line, however moving back to its zero level as it is forming lower bars below the signal line, RSI found itself a strong support at its 50 neutral zone, while 5 day SMA is acting as a dynamic resistance level. Meanwhile, our 50 day SMA is sloping upwards while 200 day SMA is still sloping downwards.

From hourly time-frame point we can see and feel weaker EURO and strengthening USD bulls. I am expecting the pair to test and most probably break below the 1.10 psychological support zone moving towards 1.0820 zone, before we see any bearish action. It is worth mentioning that 1.0825 zone has been a historically strong support/resistance zone. As we move towards vital IMF payment deadline of Greece, we should expect 1.08 level to be tested once again.

Trade expectations

If the pair breaks below 1.1000 zone, following support zones will be as 1.0930 at 50% Fibo retracement zone and 1.0825 zone at 38.2% Fibo retracement. May this level be broken as well, our following support will become as 1.05 zone.

Alternatively, the pair could slightly bounce off the 38.2% Fibonacci retracement zone, consolidating between 38.2% and 61.8* Fibonacci retracement zone.

Weekly Pivot Point: 1.1153

Weekly resistance levels: 1.1040 (R1), 1.1100 (R2), and 1.1180 (R3)

Weekly support levels: 1.1000 (S1), 1.0930 (S2) and 1.08250 (S3)