EURUSD challenged a fresh 3-year high above the 1.2300 price level during the previous week but currently, the price is holding below the aforementioned level. The price jumped to 1.2320 for the first time since December 2014, after extending a strong rally that started from the low of the 1.1900 handle.
Looking at the daily timeframe, it is worth mentioning that the Asian session has started with a gap up and the price pared those gains in the last hours. In addition, over the last five trading days, the price is consolidating within the 1.2160 support barrier and the 1.2320 resistance level, waiting for any significant economic data to push the price in either direction.
From the technical point of view, the momentum indicators seem to be in confusion. The RSI indicator dropped below the overbought area but is standing near the 70 level, however, the MACD oscillator lies above its trigger and zero line but with weaker momentum than the previous sessions. Furthermore, the 20 and 40-day simple moving averages are following the upward movement.
A sharp buying interest above the 3-year high of 1.2320, could drive the world’s most traded currency pair towards the 1.2570 resistance level, taken from the peak from December 14, 2014. This is considered to be a strong resistance area which has been rejected a few times in the past.
On the flip side, if prices reverse lower, immediate support should come at 1.2160 and slightly lower at 1.2090. A drop below this area would take the price closer to the 1.1900 strong psychological level. A breach of this level would shift the medium-outlook from positive to neutral.
