EURUSD portrays a corrective bounce from the weekly low, snapping a two-day losing streak, as the pair traders await speeches from European Central Bank (ECB) President Christine Lagarde and Federal Reserve (Fed) Chairman Jerome Powell, scheduled late Friday. In doing so, the Euro pair reverses pullback from a five-month-old horizontal resistance as the RSI (14) line returns to normal territory after a brief move in the overbought region. However, the bearish MACD signals and failure to cross the key resistance area surrounding 1.1010-1000 push sellers toward a 50% Fibonacci retracement of the July-October downside, near 1.0860 at the latest. It should be noted, though, that a convergence of the 200-SMA and previous resistance line stretched from late September, close to 1.0820-15, appears a tough nut to crack for the pair bears, a break of which will enable them to poke the mid-September peak of near 1.0700.
Meanwhile, the late August swing high of 1.0945 and the 61.8% Fibonacci ratio of near 1.0960 restrict the immediate upside of EURUSD. Following that, the aforementioned resistance region surrounding 1.1010-1000 will regain the market’s attention. In a case where the Euro buyers manage to keep the reins past 1.1000, the 78.6% Fibonacci ratio of around 1.1000 will act as the final defense of the bears before directing prices toward the yearly high of 1.1275 marked in July.
Overall, EURUSD is likely to stay pressured but the bears shouldn’t be hopeful of further downside unless they witness a sustained trading below 1.0820-15.
