- EUR/USD holds positive ground around 1.0785 on the softer USD.
- The pair maintains the bearish bias below the key 100-period EMA, but RSI indicators return above the 50-midlines.
- The key resistance level will emerge at the 1.0790–1.0800 zone; the initial support level is located at 1.0723.
The EUR/USD pair trades on a stronger note near 1.0785 for four straight days during the early European session on Monday. The decline of the US Dollar (USD) provides some support for the major pair. Two European Central Bank (ECB) policymakers said Eurozone inflation is heading back towards the 2% target, but the ECB needs further data to confirm before it can cut rates. Nonetheless, the FOMC Minutes and the Eurozone data, including the PMI and CPI inflation report could offer some hints about the inflationary trajectory.
From a technical perspective, EUR/USD keeps the bearish vibe unchanged as the major pair is below the key 100-period Exponential Moving Averages (EMA) on the four-hour chart. However, the Relative Strength Index (RSI) returns above the 50-midline, hinting that the buyers could retain control in the near term.
A potential resistance level for the major pair will emerge near the confluence of the 100-period EMA, the upper boundary of the Bollinger Band, and the psychological mark at the 1.0790–1.0800 region. A decisive break above this level will pave the way to a high of January 26 at 1.0885. The additional upside filter to watch is the 1.0900 psychological round mark.
On the flip side, the initial support level for the EUR/USD pair is seen near a low of February 5 at 1.0723. The key contention level is located near a round figure, a low of February 13, and the lower limit of the Bollinger Band at 1.0700. Any follow-through selling below the latter will see a drop to a low of November 9 at 1.0660.
EUR/USD four-hour chart
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