EURUSD seems unstoppable. After reversing yesterday from 1.20, it keeps coming back at it with a vengeance. It trades with such a bid tone that it drives the bullish price action on all the other Euro pairs. The EURAUD, EURGBP, EURJPY, etc., all catch a bid every time the EURUSD bounces from the lows.
Yet, yesterday’s move lower may mean something else for bears. For instance, it broke the recent rising trendline. Moreover, now it is retesting it, proving a nice place for a countertrade, should anyone would have an interest in shorting a pair that trades with such a bullish tone.
Also, yesterday’s rejection from the 1.20 level came in the context of the end of the month flows. Was it just a typical rejection during the main London fix or option-related? For the FX traders, all that matters is that the rising trendline is broken, so an opportunity appears to sell it on a retest.
EURUSD Technical Analysis
The retest is here. As such, bearish traders may try selling the pair against 1.20 highs with a risk-reward ratio bigger than 1:2, ideally 1:3 or more. This is still the NFP, so do not expect things to move fast until Friday. On the flip side, the more the EURUSD stays around 1.20, the likelier that it will give it another shot at the round number.