The EUR/USD pair feels supported by the prospects for a robust recovery in the eurozone together with the increasing probability of additional stimulus in the US. The risks of this positive view arise from the potential political jitters around the EU Recovery Fund and, from the growing possibilities that new measures of flexibilization of the ECB, scheduled for this Thursday, will be announced.
On the technical level, we note that EUR/USD this morning of the American session is trading below the 21-day EMA, around 1.2130 and below the 7/8 of murray around 1.2146. This zone is key, since if the pair breaks these two levels, we could expect a bullish movement until the zone 1.2207 that represents the 8/8 of murray where it will find strong resistance.
In addition, if you look at the 4-hour chart, you can see that the euro is trading within an uptrend channel, it is still within. Therefore, we can expect a technical rebound in the 1.2070 area, a level that coincides with the support line of the bullish channel, this will be a good point to buy the euro-dollar with targets at 7/8 and 8/8 Murray.
On the contrary, a definitive and sharp break below 1.2060, we hope it will make the pullback, and close the price below this level, it will be a good opportunity to sell EUR/USD with targets at 1.1962 and 1.1905 with the 200-day EMA. The eagle indicator is showing a bearish signal, we should only enter sell when the price breaks the 4-hour trend channel, hopefully the downward pressure pushes to 1.19 levels.
Trading tip for EUR/USD for December 09 – 10
Buy if the pair rebound around 1.2070 (trend channel) with take profit at 1.2146 (7/8 murray) and 1.2207 and stop loss below 1.2030.
Sell if the pair breaks below 1.2060 with take profit at 1.1962 (4/8 murray) and 1.1901 (EMA 200), and stop loss above 1.2095 (6/8).
Buy above 1.2146, with take profit at 1.2207, stop below 1.2100.