EUR/USD has been bullish since Might final yr, after the European Central Financial institution (ECB) introduced it will begin the PEPP programme to assist battle the coronavirus results. There was a retreat throughout September and October, after the failure to interrupt the massive spherical assist space at 1.20, however then the bullish development resumed once more after the US presidential elections.
The resistance zone surrounding 1.20 broke ultimately in December and consumers pushed this pair to 1.2350s. Though after the primary week of this yr, we noticed a bearish reversal and EUR/USD misplaced round 300 pips. Final week we noticed a bullish reversal and the value has been climbing greater, however this seems extra like a retrace.
The 100 SMA (inexperienced) turned from assist to resistance within the second week of January and it’s performing as resistance once more now, having rejected EUR/USD earlier in the present day. It was aided by the 200 SMA as nicely in the present day. The worth declined round 80 pips after the rejection, however the 50 SMA (yellow) is performing as assist now. EUR/USD has bounced a bit off that shifting common, however will not be too removed from it. We’re considering of going lengthy maybe, with a small purchase sign, however will see how the value reacts now.