All elements being obviously bullish, it would be possible for traders to trade only long positions (at the time of purchase) on the EUR/USD pair as long as the price remains well above the levels of 1.0201, 1.0142 and 1.0070.
The Euro has started the week on solid grounds as the US Dollar slipped on perceptions that the Fed rate hike path might have peaked in expectations.
The EUR/USD pair has rallied back through parity and crossed above the 50-day simple moving average (SMA) which might suggest a pause in short term bearish momentum.
The 100-day SMA remains a long from the price, currently just below a potential resistance zone at 1.0260 - 1.0340.
The ascending trend channel remain intact and all SMAs maintain a positive gradient. Resistance levels might be at the weekly close 1.0340 or at last week's high of 1.0449.
The buyers' bullish objective is set at the price of 1.0260. A bullish break in this resistance would boost the bullish momentum. The buyers could then target the resistance located at the price of 1.0340. If there is any crossing, the next objective would be the resistance located at 1.0340.
However, beware of bullish excesses that could lead to a possible short-term correction; but this possible correction would not be tradeable.
Conclusion :
Following a significant break above parity last week, the EURUSD pair bulls defended the area well enough to spur a rally into the weekend. Monday saw a continuation of that trend higher, but the rally stalled on the test of 1.0260.
The EURUSD pair came under further pressure late in the NY session as headlines pertaining to Apple dented sentiment.
Moreover, the RSI is becoming to signal an upward trend, as the trend is still showing strong above the moving average (100) and (50).
Thus, the maket is indicating a bullish opportunity above the 1.0260 level so it will be a good sign to buy at 1.0260 with the first target of 1.0340. It will also call for a downtrend in order to continue towards 1.0449.
The EURUSD pair will be in focus this week with the major event risk that dominates the near-term calendar. While this week's rate hike may provide a short-term boost for the beaten down Euro, sellers may reengage on any significant as growth concerns hang over the continent.
The daily strong support is seen at 1.0142. On the other hand, the stop loss should always be taken into account, for that it will be reasonable to set your stop loss at the price of 1.0070.
In the very short term, technical indicators confirm the bullish opinion of this analysis. It is appropriate to continue watching any excessive bullish movements or scanner detections which might lead to a small bearish correction (1.0070 - 1.0200).
