By has been losing ground since the beginning of the year, creating a clear structure of lower highs and lower lows within a descending channel. Nevertheless, after managing to find its feet at the 20-year low of 0.9863, the pair is pushing for some recovery, currently challenging the 50-day simple moving average (SMA).
The momentum indicators also suggest that bullish forces have gained the upper hand. Specifically, the RSI has jumped above its 50-neutral mark, while the stochastic oscillator is ascending into the overbought area.
Should buying pressures intensify and the price profoundly cross above its 50-day SMA, initial resistance could be encountered at the 1.019 hurdle, taken from the pair’s descending trendline. Conquering this barricade, the bulls could aim for 1.0290 before the July peak of 1.0368 comes under examination. Even higher, the 1.0614 resistance zone could prove to be a tough one for the pair to overcome.
On the flipside, bearish actions could send the price to test the recent resistance region of 1.0093. Sliding beneath that floor, the spotlight may turn to parity, which is considered a crucial psychological mark by markets. A violation of the latter could pave the way for the 20-year low of 0.9863.
In brief, EURUSD is attempting a rebound but the road to complete recovery remains long. Therefore, initial steps will be taken if the price clearly closes above its 50-day SMA.
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