EURUSD – strong recovery faces significant barriers, awaiting signals from US data

EURUSD extends strong recovery into third straight day, as risk mode returns and weaker than expected US data softened rate outlook.

Fresh bullish acceleration (after larger downleg was contained by rising 200DMA) hit one-week high and cracked 100DMA barrier (1.0925), eyeing pivotal levels at 1.0955/60 (base of thick daily cloud / daily Kijun-sen /Fibo 38.2% retracement of 1.1275/1.0766).

Mixed daily studies lack clear direction as 14-d momentum is still in negative territory, north-heading RSI emerged above neutrality zone and MA’s are in mixed setup.

Bulls so far hold grip but may face headwinds from 1.0955/60 resistance zone, as barriers are significant.

Markets will be closely watching incoming US data (Core PCE / weekly jobless claims on Thursday and NFP report on Friday) with weaker than expected readings to signal that high interest rates started to hurt economic growth (compared to the recent economic indicators which were surprisingly positive and signal that the economy was resilient) and cool expectations for further Fed rate hike.

The Euro may advance more in such scenario and explore levels above psychological 1.10 barrier.

Near-term action is expected to remain biased higher as long while holding above 20DMA (1.0904).

Res: 1.0960; 1.1000; 1.1020; 1.1081
Sup: 1.0925; 1.0904; 1.0859; 1.0811