EURUSD – Further to climb?

Correction may have further to run

The rally in EURUSD has stalled over the last few sessions but the bounceback may not be quite so short-lived.

After breaking below the 200/233 day SMA band in mid-June, the pair had broken into bearish territory, potentially opening up a much broader move to the downside in the months that followed.

After falling back to 1.1754, a corrective move started and while that’s stalled, there may be more to run. The stall came around the 200/233 SMA band on the 4-hour chart and it’s since consolidated around that area.

A break above here could see focus turn to the cluster of daily moving averages (55, 89, 200, 233) which fall around 1.20 and the 50 fib level (May highs to July lows).

We may see some resistance around 1.1950 initially (38.2 fib level) but the big one is 1.20, should it get that far.

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Craig Erlam

Craig Erlam

Former Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.