Euro / U.S. DollarShort
EURUSD could see a reversal below 1.08200
Technical perspective:
EURUSD is nearing the upper boundary of its descending channel, aligning with significant resistance at 1.08200, marked by the 61.8% Fibonacci retracement and the 50% Fibonacci extension. The price remains below the Ichimoku cloud, indicating potential for a reversal.
If EURUSD reverses below 1.0820, it could extend its decline toward the 1.0680 support level. A breach below 1.0680 might prompt a further slide towards the channel's lower boundary at 1.05200.
Conversely, a breakout above 1.0820 could trigger additional upside momentum, potentially leading to a retest of resistance around 1.09200.
Fundamental Perspective:
The recent rise in EURUSD can be attributed to the weakening US dollar following softer US economic data and the Federal Reserve's acknowledgement of progress in inflation, heightening expectations of a rate cut in September. However, this uptick might be temporary, given the Fed's cautious stance, awaiting more evidence of cooling inflation alongside a robust job market. In the Eurozone, initial June data indicates annual inflation easing to 2.5%, meeting expectations, although core inflation unexpectedly held steady. ECB President Lagarde highlighted that inflation risks have not sufficiently diminished at the ECB Forum.
EURUSD is nearing the upper boundary of its descending channel, aligning with significant resistance at 1.08200, marked by the 61.8% Fibonacci retracement and the 50% Fibonacci extension. The price remains below the Ichimoku cloud, indicating potential for a reversal.
If EURUSD reverses below 1.0820, it could extend its decline toward the 1.0680 support level. A breach below 1.0680 might prompt a further slide towards the channel's lower boundary at 1.05200.
Conversely, a breakout above 1.0820 could trigger additional upside momentum, potentially leading to a retest of resistance around 1.09200.
Fundamental Perspective:
The recent rise in EURUSD can be attributed to the weakening US dollar following softer US economic data and the Federal Reserve's acknowledgement of progress in inflation, heightening expectations of a rate cut in September. However, this uptick might be temporary, given the Fed's cautious stance, awaiting more evidence of cooling inflation alongside a robust job market. In the Eurozone, initial June data indicates annual inflation easing to 2.5%, meeting expectations, although core inflation unexpectedly held steady. ECB President Lagarde highlighted that inflation risks have not sufficiently diminished at the ECB Forum.
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