EUR/USD Rate Rebound Emerges Following Failure To Test 2021 Low

With that said, lack of momentum to test the yearly low (1.1664) may generate a larger rebound in EUR/USD as it attempts to halt a five day decline, but the exchange rate may trade within a defined range over the near-term as it failed to clear the July high (1.1909) earlier this month.

EUR/USD Rate Daily Chart

(Click on image to enlarge)

Image of EUR/USD rate daily chart

Source: Trading View

  • Keep in mind, EUR/USD sits below the 200-Day SMA (1.1980) for the first time since April as the advance from the March low (1.1704) failed to produce a test of the January high (1.2350), with the exchange rate trading to a fresh yearly low (1.1664) in August as the 50-Day SMA (1.1786) established a negative slope.
  • However, EUR/USD may trade within a defined range as it appears to be reversing ahead of the yearly low (1.1664), with lack of momentum to push below the Fibonacci overlap around 1.1670 (78.6% expansion) to 1.1710 (61.8% retracement) bringing the 1.1780 (23.6% expansion) to 1.1810 (61.8% retracement) region back on the radar.
  • Need a break above the July high (1.1909) to open up the 1.1950 (23.6% retracement) to 1.1970 (23.6% expansion) region, with a move above the 200-Day SMA (1.1980) opening up the overlap around 1.2080 (78.6% retracement) to 1.2140 (50% retracement).
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