FX.co ★ Trading Signal for EUR/USD for April 21 - 22, 2022: Buy above 1.0830- 1.0850 (21 SMA)

Since April 19, EUR/USD is rebounding after reaching a low of 1.0760. In less than 48 hours, EUR/USD managed to recover almost 200 pips. This is a positive sign and the currency pair is likely to continue its technical bounce and a break above the 200 EMA at 1.0963 and up to 2/8 Murray at 1.0986.

Following the rally in the European session towards the level 1.0935, EUR/USD has come under bearish pressure, making a technical correction heading towards the 21 SMA located at 1.0816.

The euro was supported by comments from the Vice President of the ECB, Luis de Guindos, who stated that a rise in benchmark interest rates is possible in July depending on macroeconomic data.

This comment was decisive which gave a strong upward momentum to the euro. The market is likely to absorb this news in the coming days and the euro could reach the psychological level of 1.10.

However, concerns regarding inflation, recession and the war between Ukraine and Russia remain unchanged. Any change in these issues could assure investors to take refuge in the US dollar and gold. Risk aversion commonly dents the strength of the euro.

The EUR/USD pair is in a corrective phase that may continue in the coming days. A close on daily charts above the 200 EMA could be a positive sign for the Euro and it could reach 1.1108 (3/8 Murray) and even reach 1.1230 (4/8 Murray).

According to the 4-hour chart, we can see that the Euro has broken a downtrend channel that had been forming since the end of March.

We can also observe some trend continuation technical patterns like a symmetrical triangle and a bullish wedge. Additionally, the euro is located above the SMA of 21 which gives it a positive bias.

Our trading plan is to expect the Euro to make a technical correction around the 1.0850 - 1.0830 area. Around this area and above the 21 SMA, it will be an opportunity to buy the euro with targets at 1.0963, 1.0983, and 1.1108.