Recovery regains traction and cracks pivotal barriers
The Euro jumped to one-week high as dollar was sold in early US trading on Monday.
Fresh strength adds to hopes that recovery may pick up after Friday’s close in red soured the sentiment, as the pair probes through pivotal barriers at 1.1776/95 (falling 10DMA / bear-trendline off 1.2242 (Feb 25 high).
Bulls need close above these levels to boost the signal, generated from last week’s hammer candle, but more evidence on reversal signal could be expected on clear break above pivotal Fibo barrier at 1.1812 (38.2% of 1.1988/1.1704).
Larger downtrend from 1.2949 (2021 high) is firmly in play and current action could be seen as positioning for fresh push lower.
Fundamentals do not work in favor of the single currency as Europe grapples with the third wave of coronavirus and France starts new lockdown, joining a number of bloc’s countries already under restrictive measures.
Res: 1.1812; 1.1835; 1.1854; 1.1873
Sup: 1.1776; 1.1749; 1.1737; 1.1704