EUR/USD has broken above the long-term downward sloping trend line resistance and approached 1.15. However, price is pulling back downwards without any confirmation for a breakout, remaining inside the trading range its been in for the last couple of weeks.
Yellow rectangles - trading range
Green line - support trend line
Red line - major trend line resistance
EUR/USD is still challenging the upper boundary of the trading range. Price is holding above 1.14 and this is a positive sign. Price reached 1.15 earlier today but because it is holiday season and trading is thin, we should be cautious before calling this a break out. Price has moved above the red trend line resistance and this is another positive sign. A back test at 1.14 and a bounce would also be a positive sign. Bears on the other hand want to see price back below the red trend line and move below 1.14. Short-term support is at 1.1430. Next support is at 1.1420 and next at 1.1340. The Daily bullish RSI divergence as we noted in previous posts suggests more upside for this pair. 1.17 area is our first target.
