EURUSD Upside Thrust Stays Beneath 1.2350 on USD Recovery

EURUSD Price Analysis – January 7

EURUSD turns negative after the 3rd day in a row upside thrust and stays beneath 1.2350 amidst a moderate recovery of the dollar on Thursday. The upside remains capped by the renewed strength in the US Treasury yields across the curve amid stimulus hopes.

Key levels
Resistance Levels: 1.2413, 1.2350, 1.2272
Support Levels: 1.2214, 1.2150, 1.2100
EURUSD Long-term Trend: Bullish
The technical trend on the daily chart implies that the recent decline is likely to find decent support and attract buyers near the 1.2214 horizontal support beneath the ascending trendline. Some subsequent sell-offs may accelerate the corrective slide towards 1.2100, although more likely to stay limited around 1.2040.

However, a sustained breach beneath would be seen as early signs of bullish exhaustion and leave the pair vulnerable to further declines to challenge the key psychological 1.2000 marks. We are watching closely for the top signs near the 1.2350 level. But a return of the bulls may have long-term bullish consequences.
EURUSD Short-term Trend: Ranging
EURUSD intraday bias altered neutral after today’s pullback. Some sideways trading is possible, but further gains may be anticipated as long as the support level of 1.2214 is held. On the other hand, a breach of the 1.2272 level may restart a stronger rebound to 61.8% of the 1.0635 forecasts to 1.2011 levels from 1.1602 at the next 1.2350 levels.

On the other hand, recent highs around 1.2272 now seem to act as immediate resistance. It is followed by last week’s swing high, around 1.2300 areas, which, if cleared decisively, may set the stage for further short-term appreciation. The pair may then breach beyond 1.2300 and aim to test the next major obstacle near the 1.2350 congestion zone.

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