EUR/USD technical analysis chart from TD
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EUR/USD has retained a slightly firmer undertone closing last week out right up against trend resistance just under 1.1450, notes TD.
"The short-term set up here looks constructive, with the short-term up trend intact and underpinned by channel support at 1.1242 and short-term trend momentum bullish," TD adds.
However, TD warns that there are some clear technical concerns in EUR/USD set-up:
1- The broader pattern of trade through March-May so far is still suggestive of a consolidation (upward tilting, bear wedge) ahead of another push lower while the daily stochastic oscillator is not "confirming" the May gains so far.
2- The spot/oscillator divergence is sometimes a warning that a move is poised to correct.
3- Sustained gains through the mid 1.14s allows for more strength (daily chart objective 1.1650/55) while weakness back under 1.1240/50 puts the bear trend back on track.
"In a broader sense, EURUSD gains through retracement resistance at 1.1296 (weekly close basis) support the impression that EUR risks are tilting higher; how much higher remains to be seen. Trend resistance at 1.1534 is a big test for spot but gains through here would likely help pull longer-term oscillators to EUR-supportive territory and put a rebound to the 1.18/1.22 range on the radar," TD concludes.
