I have a reason to believe that the EUR/USD is ready for take off. The price has been trading slightly above long-term downward channel and is currently creating a new upward channel. Should we get another attempt to break the 200SMA, we might see the EUR/USD climbing above 1.11.
Yesterday the EURUSD initially fell but found enough support at the 10-day moving average to turn around and closed near the high of the day, however closed within the previous day range, suggesting a weak bullish momentum.
The pair closed above the 10, 50-day moving averages that are acting now as dynamic support however did not managed to close above the 200 day moving average.
The key levels to watch are: A daily resistance at 1.1236, other daily resistance at 1.1097, the 200-day moving average at 1.1020 (resistance), 50-day moving average at 1.0997 (support), the 10-day moving average at 1.0944 (support) and a daily support at 1.0900.
The single currency registered a volatile session against the dollar on Monday. Ultimately, the euro slightly advanced against the dollar and so the break of resistance at 1.1066 was postponed. If bullish sentiment continue in the future, the key level will be overcome. The new week started at a price of 1.0992 as initially bearish sentiment prevailed. The pair hit bottom for the day at 1.0939 abs session closed at 1.1013.
The Euro is surprisingly getting bids two days ahead of the ECB meeting on Thursday. Is this a strategy to buy the rumour and sell the fact? Hard to tell. Will it be slammed hard after the meeting? The ECB would surely like that but they have disappointed in December so the market is suspicious...