EUR/USD is extending its growth as the USD is weakened by the DXY's drop. As you already know from my analyses, when the Dollar Index drops, the EUR/USD pair grows. It was trading at 1.0744 at the time of writing and it's almost ready to approach and reach the 1.0757 key upside obstacle.
The EUR/USD pair rallied even if the Euro-zone reported poor economic data today. The German Flash Services PMI dropped from 57.6 to 56.3 points below 57.2 estimates, Euro-zone Flash Services PMI came in at 56.3 points below 57.3 estimates, while the Flash Manufacturing PMI was reported at 54.4 points versus 54.8 forecasts.
The pair resumes its swing higher only because the Dollar Index is bearish. Fundamentally, the USD was punished by US data earlier today. The Flash Services PMI and the Flash Manufacturing PMI dropped below expectations signaling a slowdown in expansion in both sectors. Furthermore, New Home Sales came in at 591K far below 751K estimates, while the Richmond Manufacturing Index dropped from 14 points to -9 points below 9 points estimated.
EUR/USD Strongly Bullish!
As you can see on the H 4 chart, the EUR/USD ignored the near-term resistance levels and now almost reached the 1.0757 static resistance. You knew from my analyses that a valid breakout above the 1.0593 may activate further growth.
It has ignored the 1.0641 key resistance as well. Now, it has passed above the weekly R2 (1.0740) signaling strong buyers. It remains to see how it will react after reaching 1.0757 and the 150% Fibonacci line.
EUR/USD Prediction!
As long as it stays above the 1.0695 immediate low, the bias remains bullish. Strong consolidation between 1.0695 and 1.0757 could attract more buyers before resuming its growth.
Moving sideways and developing a bullish continuation pattern (triangle, range) could bring new buying opportunities. Also, a valid breakout above 1.0757 and above 150% could bring long signals.
Still, you have to be careful as false breakouts through 1.0757 or a major bearish pattern around this key level could signal a sell-off. Actually, a new sell-off could be activated by a valid breakdown below 1.0695.
