EUR/USD Breakout PotentialIt's been a grinding month of February so far but the big takeaway at this point for EUR/USD has been deductive in nature, and that's the fact that sellers haven't been able to break any fresh ground below the January low.
Early-Feb saw the threat of tariffs drive a spike-low in the pair, but that held above 1.0200, and then as the tariff threat seemed to recede a bit, EUR/USD pushed up to 1.0500 for two different tests of the big figure.
At this point bulls haven't exactly taken over matters, but the slow build of 'less bearish' can then lead into bullish breakouts.
In EUR/USD, the Fibonacci retracements produced by the 2021-2022 sell-off, and then the 61.8% bounce from that sell-off, continue to highlight important levels. The 1.0200 level is confluent with the 23.6% retracement of the longer-term move and the 61.8% retracement of the shorter-term move plotting within a single pip of each other.
The 50% mark of the shorter-term move from the 2022 low to the 2023 high (which was the 61.8% retracement of the longer-term move) is what helped to hold support last week, after showing as resistance the week before.
And sitting overhead is the 1.0611 level, which is confluent as this is the 38.2% retracement of the shorter-term move as well as the 38.2% retracement of the 2022-2023 move. If EUR/USD can push a breakout, that's the next major level of interest. - js
