FX.co ★ EURUSD bounces as expected above 1.10

EURUSD is at 1.1013. This bounce above 1.10 towards the resistance area of 1.1050 was expected as we noted in our latest analysis where we pointed out that the daily bullish reversal hammer pattern was a bullish sign.

Red rectangle - previous support now resistance

EURUSD is bouncing above 1.10 as expected. Trend however remains bearish as price is still below the Kumo. Breaking above the tenkan- and kijun-sen (red and yellow lines) has confirmed our bullish short-term view of a bounce and we could soon see prices challenge the red rectangle and the Kumo. So far this bounce is considered as a selling opportunity and a relief bounce. Breaking above 1.11 would make us change how we see the bounce into maybe something bigger.

Yesterday's daily candle was a bullish reversal hammer as we pointed out on time. Today's candlestick is a bullish follow through. A move towards 1.11 is possible to be seen by the end of this week as the pattern so far is similar to the trend reversal back in August 1st. Support is important at today's low, as a daily close below 1.0968 would be a bearish signal.