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Technical Analysis – EURUSD reverses earlier gains but maintains bullish bias

EURUSD was trading lower by mid-morning in European trade having touched a high of 1.1402 earlier in the day. The intra-day bias is to the downside as the stochastic oscillator is giving out bearish signals with %K crossing below the %D line.

The nearest support is at 1.1218, which is the 61.8% of the Fibonacci retracement level of the downleg from the May 15 high of 1.1466 to the May 27 low of 1.0818. However, the medium-term outlook is still bullish with prices continuing to trade above the Ichimoku cloud and the Tenkan-sen and Kijun-sen lines are positively aligned above the cloud. RSI also remains above 50.

The key resistance level for EURUSD is the May 15 peak of 1.1466. Failure to break out of this resistance level would likely shift the pair into a range.

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