Technical Analysis: EURUSD bulls run out of steam ahead of ECB
Although EURUSD battles a four-month-old resistance line, the lower high of prices contrasts with the higher high of the RSI (14) to portray a hidden bearish divergence and tease sellers ahead of the key European Central Bank (ECB) meeting. That said, the 21-DMA, around 1.0635 appears to be the immediate support to watch during the quote’s pullback ahead of welcoming the south-run. During the fall, the six-week-long horizontal area surrounding 1.0470-60 could act as the last defense of the buyers before directing the pair towards the yearly low marked in May around 1.0350.
Meanwhile, 38.2% Fibonacci retracement of February-May downside, near 1.0785, and March’s low near 1.0805 seem the validation points for the EURUSD pair’s further upside, even if it successfully crosses the aforementioned resistance line near 1.0740. Should the major currency pair stays firmer past 1.0805, late April swing high and the 100-DMA, close to 1.0940, will lure the pair bulls.
Overall, EURUSD’s latest rebound portrays the hawkish expectations from the ECB, failing to comply with the same can quickly drag the quote towards the south.