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- EUR/USD bulls attempting to make a break for it
- US dollar bears are pressing the bulls back below key trendline support.
EUR/USD has been drifting to the upside as the US dollar tails off below micro daily trendline support as the following will illustrate. DXY has been pressured to below 111.50 but the pace of losses is slow and bulls are in play at times of bearish pressure. It’s early days in what will be a busy week and coiled markets have a tendency to break out which could be on the cards for the week ahead.
The downside channel is dominant but there are risks of the price moving out of it to the topside.
The market is coiled and pressing against key resistance. If this holds, the downside will be in play, however.
For now, so long as the greenback remains supported at the trendline support, there will be risks of a significant move in the euro on a break of trendline support.
DXY technical analysis
The bull flag and combination with the rising trendline and W-formation make for a solid thesis for the upside. However, there are risks of a downside breakout with 111.00 vulnerable. Such a move will see the euro take off.