- EUR/USD[2] continues to stride within symmetrical triangle[3]
- Euro[4] exposed to upcoming economic factors
- COT report
- IGCS[5] points to further short-term upside
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EUR/USD UPWARD MOMENTUM SLOWS
EUR/USD[7] price action continues to push up but has since slowed relative to prior impetus. US Non-Farm Payroll (NFP)[8] data has clawed back some US Dollar[9] strength on Friday which has sustained a series of small bodied candles since Thursday last week. These daily candles imply indecision between bulls and bears who could be waiting on further data to provide a directional bias. The week ahead is riddled with Euro[10] heavy economic events which could be the catalyst for a change in sentiment.
EUR/USD TECHNICAL ANALYSIS
The monthly chart below shows EUR/USD[11] remaining within the multi-year symmetrical triangle[12] at topside resistance (yellow). As price approaches the apex of the triangle pattern, market participants will be looking for a substantial break up or down. Options traders may look to employ straddle or strangle strategies around the apex price which looks to exploit price fluctuations in either direction.
Chart prepared by Warren Venketas[14], IG
Chart prepared by Warren Venketas[16], IG
EUR/USD price action[17] exhibits a strong upward trajectory which is opposed by the Relative Strength Index (RSI)[18] as the oscillator shows a decline in momentum (black). This is known as divergence between price and the RSI – more specifically bearish divergence which is suggestive of a
