The EUR/USD pair is trading higher at the time of writing as the Dollar Index retreated in the short term. Still, don't forget that the DXY maintains a bullish bias despite temporary drops. As you already know from my analyses, we have a strong negative correlation between the EUR/USD pair and the US Dollar Index.
The pair was trading at 1.0578 at the time of writing and it continues to move somehow sideways. Fundamentally, the Eurozone data came in worse than expected yesterday, while the US Final Wholesale Inventories came in line with expectations.
Today, the Eurozone ZEW Economic Sentiment is expected at -42.0, while the German ZEW Economic Sentiment could drop deeper from -41.0 to -43.0 points. On the other hand, the FOMC members' speeches could bring some volatility.
EUR/USD Breakouts Needs Validation!
Technically, the pair failed to stabilize below the uptrend line and now it has passed above the descending pitchfork's upper median line (uml) which represents a dynamic resistance. EUR/USD could resume its growth as long as it stays above the weekly pivot point of 1.0560 and above the broken upper median line (uml).
1.0635 key level stands as a potential upside target if the rate continues to grow. Failing to stay above the pivot point and above the pivot point of 1.0560 may signal a new sell-off.
EUR/USD Forecast!
Testing and retesting the 1.0560 pivot point and the upper median line (uml) could bring buying opportunities.
Coming back below the pivot point of 1.0560 and under the upper median line (uml) could signal that the rebound ended and that the price could develop a new sell-off towards 1.0480 - 1.0471. We'll have a good selling opportunity if the pair drops and stabilizes under the uptrend line.
