European currencies are showing lots of divergences for a trend reversal to occur, but we don’t have the confirmation. The euro didn’t break the moving averages on Friday and yesterday, and the dollar index gave up from 80.58 too. But divergences and indicators are warning of a potential reversal above the level of 1.3964, however we need a further confirmation. EUR/USD rose to 1.3823 at Friday’s trading session. This area was occupied with strong selling pressure. The monthly channel could be broken if we get above the 1.3964.
The pair is trading at the level of 1.3729 in Asia. In the hourly chart oscillators are giving a positive indication, we can expect a pullback from these levels. The pair is holding above the 200EMA level. If the pair breaks above the resistance level of 1.3773, we can see another powerful rally again towards 1.39.
S1 1.3725 R1 1.3760
S2 1.3694 R2 1.3792
S3 1.3642 R3 1.3823
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