EURUSD remains in a neutral bias after pausing the uptrend from 1.0820 in April. The pair has been trading sideways in the past 3 weeks within a range of 1.1822 to 1.2091. The medium-term technical picture is still bullish and prices continue to rise within the ascending channel but the near-term outlook has shifted to a consolidation phase.
After the market reached its highest level in over 2 years on September 8 at 1.2091, EURUSD retreated to the 1.1900 area. This is now a key support level. Downside risk has diminished as RSI has stopped falling and is now flat while it remains in bullish territory above 50. MACD is horizontal and is well above the zero line which also indicates the absence of downside momentum.
Should prices fall below 1.1900 and extend lower from the range low of 1.1822, the focus will clearly turn to the downside with support at 1.1661 coming into view. A deeper fall would target a previous resistance-turned-support zone at 1.1471. Falling below this level would see the market retrace more than 50% of the 1.0820 – 1.2091 uptrend and likely move lower to 1.1290 and then 1.1100 before reversing the whole uptrend.
There is little immediate risk of a downturn for now but EURUSD needs a strong bounce from current levels to clear the 1.2091 peak in order to see a resumption of the uptrend that started in April.
EURUSD maintains a technically bullish tone for the medium-term and trend indicators are bullish. The 50-day and 200-day moving averages are positively aligned and are sloping upwards. The short-term bias is neutral as momentum signals are turning flat and suggest the market is entering a consolidation phase.