Time Zone: GMT +2
Time Frame: 4 Hours (H4)
Fundamental Analysis:
The EUR/USD currency pair remains sensitive to today’s economic releases. For the USD, the FHFA House Price Index (HPI) and the S&P Case-Shiller Home Price Index could influence the USD, with stronger than forecasted figures typically supporting the currency. Additionally, the Chicago PMI and Crude Oil Inventories data from EIA will affect market sentiment and volatility. On the EUR side, investors are closely watching the CPI Flash release, as higher-than-expected inflation could push the EUR higher, influencing expectations about future ECB monetary policy.
Price Action:
EURUSD has been in an ascending bullish channel on the H4 chart with occasional breakout failures. Currently, the last bearish candle is attempting a decisive break below the channel’s lower line. Confirmed by a regular bearish divergence, bearish momentum is strengthening, with the immediate target set around the Fibonacci retracement level of 23.6%. However, a continuation of bullish price action within the channel could retarget the recent high at 1.18215.
Key Technical Indicators:
Adaptive Moving Average (9): The adaptive moving average line remains slightly above current candles, indicating potential resistance and suggesting short-term bearish pressure.
MACD (12,26,9): MACD is currently at -0.000215 with a signal line of 0.000191, pointing toward a potential bearish crossover. This weakening momentum supports the scenario of a further bearish correction.
RSI (14): The RSI indicator is currently at 43.42, reflecting neutral market sentiment with a slightly bearish bias. It indicates there is room for further downside movement before approaching oversold territory.
Support and Resistance:
Support: Immediate support is positioned at the Fibonacci 23.6% retracement level near 1.17180, aligning with previous consolidation levels.
Resistance: Key resistance remains firm at the recent high level of 1.18215, serving as the primary bullish target.
Conclusion and Consideration:
Technical analysis of EURUSD on the H4 chart currently favors bearish momentum in the short term, confirmed by bearish divergence and weakening indicators such as MACD and RSI. Traders should closely monitor key economic releases today, particularly US housing data and EUR CPI figures, as they may significantly impact volatility and directional movements. Caution is advised given the potential for rapid shifts in market sentiment.
Disclaimer: The analysis provided for EUR/USD is for informational purposes only and does not constitute investment advice. Traders are encouraged to perform their own analysis and research before making any trading decisions on EURUSD. Market conditions can change quickly, so staying informed with the latest data is essential.
