EURUSD Candlesticks and Ichimoku Analysis

The single currency remained confined within the Ichimoku cloud area which normally suggests further sideways consolidation would take place and only a clear break above the Ichimoku cloud top (now at 1.4184, also just above a minor resistance at 1.4177) would signal the rise from 1.2457 has resumed, then re-test of 1.4339 would follow. A move above this resistance level would extend to 1.4474 (50% projection of 1.2885 to 1.4339 measuring from 1.3747), however, upside would be limited to 1.4646 (61.8% projection of 1.2885 to 1.4339 measuring from 1.3747) and euro shall stay well below resistance at 1.4720.

On the downside, the Ichimoku cloud bottom (currently at 1.3854) should provide good support and only a daily close below the support at 1.3826 would suggest the rebound from 1.3747 has ended, then retest of this level would follow, break there would bring a stronger correction of recent rise to the Tenkan-Sen (currently locating at 1.3652) and possibly 1.3500, however, 1.3398-1.3410 (approx. 50% Fibonacci retracement of 1.2457 to 1.4339 and current level of Kijun-Sen) should remain intact.

On the daily chart, price is still trading well above the Ichimoku cloud and the Kumo has started to turn upwards last week, suggesting the rebound from 1.3747 might bring further rise to 1.4120/30, however, only a daily close above the resistance at 1.4177 would confirm the correction from 1.4339 temporary top has ended at 1.3747, then recent upmove should resume for gain to 1.4260/70, then retest of 1.4339 but this level is likely to hold on initial testing.

On the downside, whilst pullback to 1.3950/60 cannot be ruled out, only if euro drops below the Tenkan-Sen (now at 1.3943) and close below there on a daily basis, this would prolong the choppy consolidation and fall to 1.3890 would take place. However, only a clear break of the support at 1.3826 would abort our mildly bullish view and bring another decline towards 1.3747 support.