EUR/USD Ignored The Downtrend Line!
EUR/USD rallied last night right after the FOMC. Now it is located at 1.2129 below 1.2150 today’s high. The pair has jumped above strong upside obstacles. The bias remains bullish.
The FED kept its monetary policy unchanged after yesterday’s meeting. EUR/USD dropped further as the USDX was still bearish despite the most recent temporary rebound. The pair could slip lower if the US dollar index starts increasing after yesterday’s sell-off.
The US is to release the Advance GBP, Advance GDP Price Index, Pending Home Sales, and the Pending Home Sales later today. USD should appreciate in the short term if the US data will come in line with expectations or better.
EUR/USD increased further as long as it is located above the uptrend line. Its failure to reach the major downtrend line in the previous attempt signaled that the price could still jump higher.
Now is located above the downtrend line after registering an aggressive breakout through this dynamic resistance. It has found temporary resistance at the weekly R1 (1.2150). Now it could come back to test the broken downtrend line.
Stabilizing above the downtrend line could signal a new upside momentum. The major upside target stands at the upper median line (UML) of the descending pitchfork. EUR/USD could increase further as long as it stays above the uptrend line.
Staying above 1.2116 static support and beyond the downtrend line and uptrend line after the current decline could bring a new opportunity. A false breakdown through these levels, a pin bar, could be seen as a long signal.
Also, a valid breakout above the R1 (1.2150) could represent a buying opportunity with an immediate upside target at 1.2200.
The material has been provided by InstaForex Company – www.instaforex.com