The downtrend extending from 1.3700 was broken when we had a daily closure above 1.3075 which opened the way towards 1.3106 and then 1.3250.
The price level around 1.3250 provided resistance for the EUR/USD pair as it corresponds to the previous tops (including the May's high). However, this week we had two successive bullish engulfing daily candlesticks which ensure the bullish strength at the current time.
Today, the pair is challenging the last week top at 1.3308. The attempt to fix above it will open the way towards the next level at 1.3370.
A bullish breakout above 1.3100 opened the way towards 1.3250 directly.
The pair has a prominent support level at 1.3100 that was established last week at the depicted broken price range.
Price action should be watched at 1.3100 for a possible BUY entry with SL located below 1.3045.
The level of 1.3225 needs to be broken in order to initiate a retracement. Otherwise, fixation above it will bring more bullish strength to the market aimimg at 1.3370-1.3400 initially.
Fundamentally, the euro fell temporarily against the U.S. dollar today after increased borrowing costs in the surrounding areas in the euro zone, but losses were limited as industrial production data was above expectations which refers to the stability of the economy.
