FX.co ★ EUR/USD challenges confluence area

The EUR/USD pair rallied today and now is trading at 1.1108 far above 1.0969 today's low. It has climbed as much as 1.1137 today registering a new high. The pair edged higher as the Dollar Index plunged. Technically, the price reached strong upside obstacles, it remains to see how it will react.

Surprisingly or not, the Euro rallied even if the Eurozone German Import Prices rose only 1.3% versus 1.5% expected, while the German Gfk Consumer Climate was reported at -15.5 points below -14.6 points estimated.

In the short term, the USD is strongly bearish. The greenback failed to appreciate after the US reported better than expected data today. The CB Consumer Confidence was reported at 107.2 above 106.9 points expected, while the JOLTS Job Openings came in at 11.27M above 11.00M estimates. In addition, the HPI and the S&P/CS Composite-20 HPI came in better than expected as well.

EUR/USD Downside Invalidated!

EUR/USD registered an amazing rally after printing only fasle breakdowns below 1.0960 support area. Now, it challenges the descending pitchfork's upper median line (UML), the weekly R2 (1.1110), the 1.1121 static resistance, and the uptrend line.

We have a strong confluence area at the intersection between these upside obstacles. A new higher high, a valid breakout above 1.1137 could activate and confirm an upside continuation and a potential bullish reversal.

EUR/USD Outlook!

A new higher high, jumping and closing above 1.1137 could announce an upside continuation and could bring new long opportunities.

On the other hand, false breakouts or a strong bearish pattern here below the resistance levels may announce a new bearish momentum.