EUR/USD Bullish Outlook Strengthened
As analyzed during the last market session, the EUR/USD has reasserted its bullish character, with the Federal Reserve pausing rate hikes in light of a lower Consumer Price Index (CPI), we are pretty bullish on EUR/USD due to anticipated USD weakness..
Technical analysis: While the Dollar Index (DX) is recovering, presenting a technical selling opportunity, the EUR/USD pair's support around 1.1065 held firm, propelling prices back towards the 1.1090 benchmark. A significant advance for the Euro is contingent on a successful test and close above the 1.1090 - 1.1100 resistance. Failing that, the 1.1040 - 1.1050 zone may come into play as a viable target, offering a substantial trading opportunity. Given the holiday in the U.S. market today, we expect subdued price action. However, the Euro's resilience suggests that if DX retreats, a test of higher resistance is a reasonable expectation. If the 1.108 support gives way, a further drop to around 1.1065/1.1040 could follow, but no significant moves are anticipated in the short term.
Our position: Embracing a bullish perspective, we are looking for opportunities to enter long positions, particularly if the price action confirms a breakout above the 1.1100 resistance. With the market adapting to the Fed's pause in rate hikes, the "Buy on Dips" strategy now seems favorable for the EUR/USD pair.
Technical analysis: While the Dollar Index (DX) is recovering, presenting a technical selling opportunity, the EUR/USD pair's support around 1.1065 held firm, propelling prices back towards the 1.1090 benchmark. A significant advance for the Euro is contingent on a successful test and close above the 1.1090 - 1.1100 resistance. Failing that, the 1.1040 - 1.1050 zone may come into play as a viable target, offering a substantial trading opportunity. Given the holiday in the U.S. market today, we expect subdued price action. However, the Euro's resilience suggests that if DX retreats, a test of higher resistance is a reasonable expectation. If the 1.108 support gives way, a further drop to around 1.1065/1.1040 could follow, but no significant moves are anticipated in the short term.
Our position: Embracing a bullish perspective, we are looking for opportunities to enter long positions, particularly if the price action confirms a breakout above the 1.1100 resistance. With the market adapting to the Fed's pause in rate hikes, the "Buy on Dips" strategy now seems favorable for the EUR/USD pair.
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