FX Play of the Day: EUR/USD Uptrend to Resume Soon?
This forex pair is still hovering above its short-term rising trend line, and it looks like the eurozone PMIs might spur a move higher.Analysts are expecting to see slight improvements in the manufacturing sectors of both Germany and France, so these might be enough to keep ECB tightening hopes in play.In contrast, the U.S. economy is slated to report dips in both manufacturing and services activity for April.If that’s the case, just how high can EUR/USD go from here?EUR/USD: 1-hourThe pair has formed higher lows on its latest test of the trend line support, which suggests that bullish momentum is building up.However, price is stuck in a holding pattern for now, so a break higher might be needed in order to encourage more buyers to hop in.I’m holding out for a move above the 1.1000 major psychological mark as confirmation that bulls are charging, and this could be enough to take EUR/USD all the way up to the swing high at 1.1075 and beyond.Note that technical indicators are also hinting at a continuation of the uptrend.The 100 SMA is above the 200 SMA to confirm that support levels are more likely to hold than to break. Also, Stochastic has some space to climb before reflecting exhaustion among buyers.A break below the area of interest and 61.8% Fib would invalidate this bullish idea, as this might signal that a reversal is in the works.This might be the outcome if either eurozone PMIs disappoint and/or U.S. data surprise to the upside, so watch out for those reports.Check out this Event Guide for the April Euro Area PMIs!Don’t forget that EUR/USD moves an average of 83.6 pips per day, so a long entry above 1.1000 and target past 1.1075 would be within range. Considering a stop loss below 1.0930 would give roughly a 1:1 return-on-risk profile for this setup.
This forex pair is still hovering above its short-term rising trend line, and it looks like the eurozone PMIs might spur a move higher.
Analysts are expecting to see slight improvements in the manufacturing sectors of both Germany and France, so these might be enough to keep ECB tightening hopes in play.
In contrast, the U.S. economy is slated to report dips in both manufacturing and services activity for April.
If that’s the case, just how high can EUR/USD go from here?
EUR/USD: 1-hour
The pair has formed higher lows on its latest test of the trend line support, which suggests that bullish momentum is building up.
However, price is stuck in a holding pattern for now, so a break higher might be needed in order to encourage more buyers to hop in.
I’m holding out for a move above the 1.1000 major psychological mark as confirmation that bulls are charging, and this could be enough to take EUR/USD all the way up to the swing high at 1.1075 and beyond.
Note that technical indicators are also hinting at a continuation of the uptrend.
The 100 SMA is above the 200 SMA to confirm that support levels are more likely to hold than to break. Also, Stochastic has some space to climb before reflecting exhaustion among buyers.
A break below the area of interest and 61.8% Fib would invalidate this bullish idea, as this might signal that a reversal is in the works.
This might be the outcome if either eurozone PMIs disappoint and/or U.S. data surprise to the upside, so watch out for those reports.
Check out this Event Guide for the April Euro Area PMIs!
Don’t forget that EUR/USD moves an average of 83.6 pips per day, so a long entry above 1.1000 and target past 1.1075 would be within range. Considering a stop loss below 1.0930 would give roughly a 1:1 return-on-risk profile for this setup.
