Title: In-Depth Technical Analysis: EUR/USD Mid-Day Outlook
Source: Adapted from original analysis by ActionForex.com
Original Author: ActionForex Technical Team
Published: June 5, 2024
Original Link: [Action Forex EUR/USD Mid-Day Outlook](https://www.actionforex.com/technical-outlook/eurusd-outlook/606600-eur-usd-mid-day-outlook-2128/)
Overview
The EUR/USD currency pair is exhibiting signs of near-term stability, with a sideways consolidation pattern emerging below the 1.0915 short-term resistance level. The pair tested the 1.0915 threshold but failed to sustain momentum, suggesting a temporarily exhausted bullish run. The larger technical landscape, however, still implies that the bullish trend may resume after this consolidation phase. In this analysis, we examine the current price action, interpret technical indicators, and outline potential scenarios for both upside and downside movements.
Short-Term Market Outlook
– The EUR/USD pair is holding within a consolidation range near 1.0915.
– The price action indicates a pause in emerging upside momentum rather than a reversal.
– Immediate intraday bias is neutral as prices hold below resistance at 1.0915.
– A firm breakout above this level would signal the continuation of the recent bullish move that began at 1.0600.
Resistance and Support Levels
– Immediate Resistance: 1.0915 – This level marks a pivotal point for short-term price action. A sustained break above 1.0915 may open the door for further upside movements.
– Next Intermediate Resistance: 1.0980 – This was a previous reaction high and could provide the next ceiling if bullish momentum gathers strength.
– Key Resistance: 1.1094 – The high from March could act as a strong barrier should EUR/USD aim for new highs over the medium term.
– Immediate Support: 1.0805 – This is the first line of defense during pullbacks.
– Deeper Support: 1.0746 – A break below this level suggests a stronger downside correction and would challenge the medium-term bullish scenarios.
– Key Pattern Support: 1.0600 – This is the origin of the current bullish wave, and any drop below would signal a possible trend reversal.
Bullish Case Scenario
To sustain and extend the current uptrend that initiated from 1.0600, EUR/USD will need to:
– Break and hold above 1.0915 resistance.
– Post a daily close above 1.0915 to confirm breakout strength.
– Maintain bullish alignment on momentum indicators, including RSI and MACD on the 4-hour and daily charts.
– Target the 1.0980 region as the next step, with eventual possibilities of rallying toward the March high at 1.1094.
If the pair breaks through the aforementioned resistance levels with volume and confirmation from technical indicators, it would validate the upward leg continuing from the May lows.
Bearish Case Scenario
In contrast, if the pair loses near-term momentum and violates key support levels, a more meaningful pullback may unfold. Bearish confirmation steps include:
– Failure to break 1.0915 followed by rejection candles on the daily chart.
– Price closes below 1.0805, initiating selling pressure.
– Further decline that takes the pair through the 1.0746 support would suggest a topping pattern is forming.
In this case, traders would look for the pair to retest the base of the rally at 1.0600. A daily or weekly close below that zone would shift the longer-term outlook to bearish.
Technical Indicators in Focus
1. Relative Strength Index (RSI)
– Currently near neutral territory (50-55 on daily chart).
– Indicates a pause in momentum, neither overbought nor oversold.
– A bounce from this range could support renewed bullish activity.
2. Moving Average Convergence Divergence (MACD)
– The
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