Positive tone ahead of EU data but key barriers continue to cap
The Euro holds positive tone in early Thursday’s trading and probes again into daily cloud, despite Wednesday’s strong upside rejection at 1.1323 and repeated daily close below cloud base / 55SMA (1.1303/05).
Fourth consecutive failure to clearly break above pivotal barriers provided by daily cloud base, 55SMA and Fibo 50% of 1.1448/1.1183 (1.1316) keeps the downside vulnerable as thick daily cloud continues to heavily weigh on near-term action.
Daily studies remain mixed (bullish momentum continues to rise, stochastic heads south, RSI is flat in neutral zone while MA’s are in mixed setup) and lack clearer direction signal.
Eventual break of above mentioned barriers is required to signal continuation of recovery leg from 1.1183 that would unmask targets at 1.1347 (100SMA / Fibo 61.8% of 1.1448/1.1183) and 1.1372 (daily cloud top).
Converging 30/20SMA’s offer solid supports at 1.1279/73, close below which will be bearish.
The Euro was boosted by strong data from China on Wednesday, which revived risk mode and focuses series of PMI data from EU countries for fresh signals.
Res: 1.1295; 1.1305; 1.1316; 1.1323
Sup: 1.1289; 1.1279; 1.1273; 1.1259