In the past week, EURUSD has oscillated in the newly formed uptrend channel.
EURUSD has broken the significant resistance level at 1.1000 and the upper band of the uptrend channel with strong bullish momentum yesterday, as the dollar weakened, caused by the narrowing US polls.
The current price is trading below the short term major resistance zone, between 1.1100 to 1.1140, the selling pressure will get heavier at this level.
The 4 hourly and the daily Stochastic Oscillators are both above 80, also the 4 hourly RSI indicator is around 80, suggesting a retracement.
The price will likely pull back and test the uptrend channel support.
The resistance level is at 1.1100, followed by 1.1120 and 1.1140.
The support line is at 1.1060, followed by 1.1030 and 1.1000.
Keep an eye on the US ADP Employment Change (Oct), at 12:15 GMT today. More importantly, the Fed’s interest rate decision and monetary policy statement, at 18:00 GMT today.
We can expect that it will cause volatility for the dollar, major currency pairs, equities and precious metals.
This morning we saw the release of German Unemployment Rate and Unemployment Change figures for October.
The Unemployment Change significantly dropped by 13K, compared to expectations of a 1K decrease, which was the best performance since this April. The Unemployment Rate dropped slightly to 6.0%, compared to expectations of 6.1%.
DAX index has retraced since 25th October, after testing the long term resistance level at 10850. The pullback was followed by a sharp fall yesterday, as a result of the uncertainty associated with the US presidential election.
The range between 10340 – 10400 is the short term support zone, which is providing a stronger support, the bearish momentum is likely to wane temporarily at this level.
Yet caution should be taken before the release of the US election outcome.
The resistance level is at 10450, followed by 10500 and 10540.
The support line is at 10400, followed by 10370, 10340 and 10300.