EUR/USD is trading above 1.2150, reversing earlier losses stemming from US Treasury Secretary Yellen's comments that higher interest rates are a plus. Tension is mounting ahead of the ECB and US inflation figures.
The currency pair is capped by a downtrend resistance line that was formed in early June and dropped under the critical barrier of significant support resistance level below 1.2180 on the four-hour chart. With downside momentum also pressuring the pair, bears are taking the lead.
EUR/USD is now trading at a confluence level of Fibonacci retracement if 1st-4th June bearish move. If this level enables the bears to prevent a further upside, then the price could retest a previous swing low. Alternatively, if a breakout occurs, EUR/USD could revisit June high.
Some support awaits at 1.2100, a swing low from late May, a clear separator of ranges that is the current monthly low. The next levels to watch are 1.2070 and 1.2015.
Some resistance is at 1.2185, Friday's peak, followed by 1.220 and 1.2155, which held EUR/USD down in the past week.
