Consolidation above the previously broken uptrend line and SMA 100 has been going on after the pair established a consolidation range between 1.3200 and 1.3300.
The weekly candlestick was a pin-bar representing hesitation, this came after 3 successive bullish weekly candlesticks after hiting 1.3300 which is considered as an important resistance zone.
Moreover, on Monday the EUR/USD pair retreated from 1.3300 and fell to 1.3230 before pulling back upwards again to break through above 1.3300.
Tuesday's bullish engulfing daily candlestick enhanced the bullish continuation scenario off the previous congestion zone to have its projection target around 1.3425.
The euro is not expressing strong bullish steam after the bullish breakout above 1.3300 took place this week. However, consolidation above 1.3300-1.3330 ( broken top ) favours the bullish direction towards 1.3425.
Intraday demand zones are located around 1.3300 then 1.3240, which corresponds to mid-range support, a breakdown of which will delay further bullish momentum in the short-term outlook.
The pair needs to fixate above 1.3330 in order to collect sufficient steam to hit higher targets. Otherwise, stepping below 1.3330 will allow bearish retracement to take place intially towards 1.3240.
Fundamentally, USD fell significantly against other major currencies during the trading day amid ongoing concerns about whether the Fed will cut its cash facilities, as well as strong Chinese data supported risk appetite.
