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EURUSD: new bullish momentum above EMA50 from 1.04485

EURUSD: new bullish momentum above EMA50 from 1.04485

The EURUSD has been retreating from the 1.12757 level since mid-July, and this week, the pair formed a new yearly low at the 1.04485 level.

EURUSD chart analysis

Today’s chart review will be on a four-hour time frame in order to give us a broader overview of EURUSD movements in the previous period, and based on that, we will analyze the future potential trend.

The EURUSD has been retreating from the 1.12757 level since mid-July, and this week, the pair formed a new yearly low at the 1.04485 level. We will focus on the period from mid-August to today. As we can see on the chart, the movement takes place in the bearish channel, and there are no major breakouts that could change the trend.

At the end of August, we had an attempt to initiate a more serious recovery from the 1.07660 level, breaking above the EMA50 moving average (yellow line). We also made a retest at the EMA50, which at that moment was a bullish signal so that we could see a bigger bullish movement of the EURUSD. Unfortunately, the pair stops at the 1.09456 level and returns below the EMA50 and into the previous bearish channel.

Previous bearish consolidation continued

After that, the previous bearish consolidation continued with the formation of a new lower low this week at the 1.04485 level. Now we see a similar movement as at the end of August. First, a bullish consolidation, then a breakthrough above the EMA50 moving average and the formation of a lower high for now at the 1.06000 level. We need a new retest at the EMA50 moving average as a confirmation of a new higher low and the initiation of a new bullish impulse.

We can also pay attention to the strength of that bullish pullback to the upside. In the first attempt, EURUSD recovered by 1.67%, and the current bullish attempt is at 1.44%. Based on that, we need a stronger pullback compared to the previous one, which would leave room for consolidation, the formation of a new bottom and continue on the bullish side. Potential higher targets are 1.07000 and 1.07500.

A return below the EMA50 moving average would return us to the previous bearish channel, and we would likely see the formation of a new low after that. Potential lower targets are 1.04000 and 1.03500 levels.

 

The post EURUSD: new bullish momentum above EMA50 from 1.04485 appeared first on FinanceBrokerage.

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