Thursday’s session was market by strong upside momentum that allowed the common European currency to appreciate 96 pips against the Greenback.
The morning was spent with low volatility that seemed to point to a period of consolidation. However, a test of the weekly PP was followed by a notable surge up to the 1.2520 mark as a result of which the Euro surpassed the 1.25 mark and formed a new 1,5-year high.
Bulls might still succeed at pushing the rate slightly higher; however, the weekly R1 at 1.2575 is unlikely to be breached. The base scenario favours the rate approaching the support area formed by the 55-, 100– and 200-hour SMAs in the 1.2440/00 range.
Meanwhile, the following week might mark a breakout of this cluster and a subsequent fall.