**Euro to Dollar Outlook: Signals Point to Resumption of Uptrend**
*Adapted and expanded from the original article by James Skinner, PoundSterlingLive.com*
The EUR/USD currency pair, after a short corrective period, appears poised to resume its upward trend that began in mid-April. Analysts monitoring both technical indicators and macroeconomic developments suggest that the euro could regain momentum in the coming sessions, supported by underlying economic trends and technical setups.
This article explores the confluence of factors implying EUR/USD may return to an uptrend, based on a technical analysis framework and macroeconomic backdrop as highlighted in the article by James Skinner on PoundSterlingLive.com, with added commentary and elaboration for greater clarity and depth.
## EUR/USD: Recent Performance Overview
The EUR/USD has been exhibiting bullish dynamics since mid-April, forming higher highs and higher lows. Following its local peak at 1.0895, a corrective decline unfolded. A notable feature of technical markets is that trends don’t move in a straight line; corrections are part of a healthy trending structure. Recent price action suggests this correction may be complete and the bullish momentum could be returning.
### Key Observations from Recent Price Action:
– On the daily chart, EUR/USD posted a strong bullish candle recently, a potential reversal signal from the correction low.
– Indicators including moving averages support a medium-term uptrend scenario.
– A shift in market sentiment is potentially driving increased demand for euros, especially after economic data out of the eurozone suggested relative economic resilience compared to previous expectations.
## Technical Analysis: Bulls Regaining Control
Technical analysis points to signs that the euro is rounding out of a corrective phase and may soon resume its march higher against the US dollar. The EUR/USD chart exhibits several key bullish signals that professionals commonly refer to when identifying the continuation of a trend.
### Daily Chart Overview
– **Trend Structure:** Since mid-April, the EUR/USD has established an uptrend, evident in its pattern of higher highs and higher lows.
– **Corrective Pullback:** The pair pulled back from 1.0895 but found support near the rising 20-day exponential moving average (EMA), a commonly followed technical level that often acts as dynamic support in uptrending markets.
– **Bullish Candlestick:** A large bullish candlestick at support hints that buyers are stepping back into the market, which could initiate a new bullish impulse higher.
– **Key Levels:** A climb above 1.0895 would likely confirm a continuation of the uptrend and open the path toward further upside resistance levels.
### Elliott Wave Perspective
– From an Elliott Wave viewpoint, the recent bounce could represent the start of a new impulsive wave, typically aligned with market momentum.
– The prior downturn can be interpreted as wave 2 (the correction), and the current upturn as wave 3, which is often the strongest and longest among impulsive waves.
## Intraday Timeframes Reinforce the Bullish Bias
Not only does the daily chart signal strength, but intraday charts such as the 4-hour and hourly charts offer complementary insights confirming upside momentum.
### Observations from Lower Timeframes
– **Pattern Formation:** On the 4-hour chart, EUR/USD shows the formation of a bullish flag, a continuation pattern that typically precedes further upside.
– **Breakout Potential:** A clear move above the upper boundary of the flag pattern could confirm a breakout with further gains expected.
– **Volume Support:** Rising peaks in volume around bullish candles imply increased market participation on the upside.
## Key Upside Targets to Watch
Should the pair move decisively above the 1.0895 recent high, technical projection models provide the following potential targets:
– **1.0955 to 1.1000:** This area marks the next round-number psychological resistance and could act as a short-term price magnet.
– **1.1120:** If bullish momentum accelerates, this level represents a crucial zone
Read more on EUR/USD trading.