EURUSD climbed to a new one-month top of 1.1370 earlier today, breaking the neutral range of 1.1187 – 1.1347 to the upside, which had been holding since June 11. This bullish penetration drove the momentum indicators higher sending the stochastic into the overbought territory and the MACD above its trigger line in the 4-hour chart. Moreover, the 20- and 40-period simple moving averages (SMAs) are moving higher, while the 100-period SMA is still flattening.
The three-month high of 1.1421 is the nearest resistance that could reject any attempt higher. If not and the price extends positive momentum, 1.1495 could take over, identified by the top on March 9.
On the flip side, a downside reversal below the short-term moving averages could bring the 1.1256 support, which overlaps with the Ichimoku cloud and the 200-period SMA, back into view. Should it fail to hold, the 1.1165 – 1.1184 area would be the next target, where any violation would raise fears over a down-trending market.
In brief, EURUSD is facing some upside pressure above the near-term consolidation area with buyers waiting for a decisive close above 1.1421 to restore optimism over an up-trending market in the medium-term timeframe.