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EUR/USD Price Analysis: Surges eyeing a test of the 50-DMA

  • The EUR/USD rises near 1% following a lower-than-expected US inflation report.
  • The shared currency didn’t crack the 50-DMA early in the brand new York session.
  • From the long-term perspective, the pair is neutral-to-downward, however the one-hour chart keeps buyers hopeful after they clear 1.0344.

The EUR/USD rallies towards the 50-day EMA, reaching a five-week most of around 1.0366, amidst an upbeat sentiment, thanks to less than estimated US inflation. That, alongside investors scaling back odd of a 75 bps rate hike by the Fed, spurred a risk on reaction, around equities soaring. During writing, the EUR/USD is trading at 1.0303. up by almost 1%.

EUR/USD Price Analysis: Technical outlook

From the daily chart perspective, the EUR/USD continues to be neutral to downward biased. However, buyers are gathering momentum, as shown by the Relative Strength Index, decisively breaking above the 50-midline for the very first time since June 8, signaling buyers are stepping in. Nevertheless, sellers would obtain the upper hand until buyers reclaim the 50-day EMA at 1.0344.

In the one-hour time-frame, the EUR/USD rally is apparently losing steam, at the daily high at 1.0368, with the major retreating towards current prices, at the R3 daily pivot. The fall may be related to the Relative Strength Index (RSI), which advanced sharply towards overbought territory at 87 before exiting and sits at 64 as buyers have a breather. Therefore, the pair is upward biased in the near term.

Upwards, the EUR/USDs first resistance will be the August 10 high at 1.0368. Once cleared, another supply zone will be the 1.0400 figure, accompanied by the July 4 daily high at 1.0445.

EUR/USD Hourly chart

EUR/USD Key Technical Levels

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