The EURUSD has bounced and in the process, moved back above the swing lows from Wednesday and Thursday between 1.0863 and 1.0873. The price is currently trading at 1.0873 which is just below the close from yesterday at 1.0878. The high price reached 1.0879 so far.
As outlined in an earlier post, a move back above the swing area threatens the seven day decline seen in the EURUSD. The failure on the break – at least in the short term – will now have traders eyeing the 1.08633 level as support. If it can hold, getting above the close from yesterday, and moving toward other upside targets will be eyed.
On the upside more momentum would look toward 1.0900, followed by the falling 100 hour MA at 1.0914.
What is the catalyst?
The move higher in the EURUSD corresponded with the headlines from the ECB of a “crisis tool” to be activated if bond yields rise (sounds like quantitative easing to me).
In any case, technically speaking, the price fall was halted. The move back above the aforementioned swing area threatens the seven day decline, but buyers will have more work to do to take back more control. Getting above 1.0900 and then the 100 hour MA are the next upside steps that would give the buyers more confidence.