EURUSD Breaks Beneath Key 1.2000 Level As Stimulus Optimism Boost the Dollar

EURUSD Price Analysis – February 4

EURUSD has lost substantial levels after the pullback from the 1.2350 barriers while breaking beneath the key 1.2000 psychological level during the European session. The US dollar continues to benefit from Biden stimulus optimism which relatively is strengthening the US economic recovery.

Key Levels
Resistance Levels: 1.2350, 1.2214, 1.2050
Support Levels: 1.1941, 1.1800, 1.1602
EURUSD Long term Trend: Ranging
After losing ground for the 4th day in a row, the EURUSD accelerates the downside and finally breaks beneath the 1.2000 psychological marks. At the moment, the pair is plunging 0.40% at 1.1986 and faces initial support at 1.1941 seconded by 1.1900, and finally 1.1800.

On the flip side, a break above 1.2050 around moving average 5 would target 1.2156 (weekly high Jan.29) en route to 1.2214 level. If buying interest persists, traders could move towards the 1.2156 and 1.2200 marks, shifting the bearish bias to neutral. Looking up, the former support line of 1.2050 is strong resistance and may cap any upside movement.
EURUSD Short term Trend: Bearish
Intraday bias in EURUSD stays on the downside as a fall from 1.2350 is in progress for channel support (now at 1.1914). A sustained breach there would argue that it’s correcting the whole uptrend from 1.0635 to 1.2350 levels. The next near term target will be a 100% projection of 1.2350 to 1.2050 from 1.2214 at 1.1850 first.

On the upside, a break of the 1.2200 resistance mark, though, will suggest that the correction has been completed and bring a retest of 1.2350 high. The Relative Strength Index on the four-hour chart is still above 30, thus outside oversold conditions with room for more downsides.

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