Fibo support at 1.0993 remains key point; weekly close in focus
The Euro is holding above 1.10 mark in early Friday’s trading but attempts to extend Thursday’s recovery rally lack strength and were so far capped by broken Fibo 50% barrier at 1.1029.
Strong downside rejection under key Fibo support (61.8% of 1.0878/1.1179) at 1.0993 and subsequent rally, give initial signal of formation of bear trap pattern.
Confirmation of such scenario would require lift and close above 55DMA (1.1036) that would open way for further recovery.
On the other side, risk of fresh attempt through 1.0993 pivot exists as negative momentum on daily chart is gaining pace and falling 10DMA is on track to form bear-cross with 55DMA.
Close below 1.0993 would signal bearish continuation through another pivotal support (daily cloud base at 1.0982) that would open way towards targets at 1.0949/40 (Fibo 76.4% of 1.0878/1.1179 / 8 Oct trough).
EU CPI data are key event of European session, with a batch of US data to be released in the afternoon and expected to provide fresh signals.
Res: 1.1036; 1.1064; 1.1084; 1.1095
Sup: 1.1015; 1.0993; 1.0982; 1.0949