EUR / USD is trading within a range of 1.1230 - 1.1358. Having bottomed at 0/8 Murray, the pair is rebounding and approaching the 21 SMA which acts as resistance. A breakout and consolidation above 1.1290 could accelerate the bullish move to the 200 EMA and top of the range at 1.1358.
The zone of 1.1230 which coincides with 0/8 Murray has become strong support for the euro. As long as it remains above this level, the euro is likely to try to rally and could challenge the strong resistance of the 200 EMA at 1.1358.
Conversely, a daily close below 1.1230 could push the pair down to the psychological level of 1.1000. The euro could be vulnerable to further declines if the Fed focuses on increasing the interest rates, expected for the first quarter of 2022.
According to the 4-hour chart, the key will be to watch the 1.1230 level. A technical bounce or a consolidation around this area will give us the opportunity to buy with targets up to 1.1352.
On the other hand, a pullback towards 1.1358, where the 200 EMA is located, will be an opportunity to sell the euro with targets at 1.1291 and 1.1230.
Our forecast in the next few hours for the euro is a consolidation above 1.1230. As long as EUR / USD is trading above this zone, we will have an opportunity to buy with the target at 1.1289 (1/8) and 1.1358 (200 EMA).
The market sentiment report for today, December 20, shows that there are 69.32% of operators who are buying the EUR / USD pair. This data provides a bearish sign in the long term. We could expect a recovery to 1.1358 (200 EMA). Then, the price may again resume its downward movement with the target at 1.1169 (-1/8).
Support and Resistance Levels for December 20 - 21, 2021
Resistance (3) 1.1352
Resistance (2) 1.1310
Resistance (1) 1.1271
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Support (1) 1.1230
Support (2) 1.1196
Support (3) 1.1158
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A trading tip for EUR/USD on December 20 - 21, 2021
Buy above 1.1230 (0/8) with take profit at 1.1290 and 1.1358 (200 EMA), stop loss below 1.1190.
