February 4, 2023

Extends bounce off 50-SMA inside bullish channel

  • EUR/USD grinds higher during five-week winning streak, steadies of late.
  • Bullish chart pattern, sustained bounce off 50-SMA joins upbeat RSI to keep buyers hopeful.
  • Sellers need to conquer monthly support to retake control.

EUR/USD prints mild gains around the 1.0900 threshold as traders await fresh clues to extend the five-day uptrend during Wednesday’s sluggish Asian session.

Even so, the two-week-old rising trend channel joins the EUR/USD pair’s successful rebound from the 50-SMA, around 1.0835 by the press time, to underpin the bullish bias for the major currency pair.

It’s worth noting that the weekly resistance breakout and the firmer RSI (14) also keep the EUR/USD bulls hopeful.

That said, the EUR/USD bulls are en route to the top line of the aforementioned bullish channel, close to 1.0945 at the latest.

Following that, the 1.1000 round figure and March 2022 peak surrounding 1.1185 could gain the market’s attention.

Alternatively, pullback moves need to drop back below the immediate resistance-turned-support line from Monday, close to 1.0875 at the latest, before aiming for the 50-SMA support of 1.0838.

Even if the EUR/USD pair remains bearish past 1.0838, the lower line of the stated channel, near 1.0820 by the press time, becomes the key to watch for clear directions.

It should be observed that a horizontal area comprising multiple levels marked since the start of 2023, close to 1.0700, will be crucial for the EUR/USD bear’s conviction.

EUR/USD: Four-hour chart

Trend: Further upside expected

 

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