EURUSD recovers above 1.13 after dropping below it last week. The market focuses on today's Eurozone inflation data and the Fed rate statement coming later in the week.
December 17, 2018 | AtoZ Markets - EURUSD dropped below 1.13 last week after an effort to 1.14 couldn't be sustained. Price is currently retracing above 1.13 with the Eurozone risk sentiment improving after the Italian government agreed on the new budget. The major macro economic events happening today, though of small impact, is the inflation data from the Eurozone. The biggest event this week is the FOMC rate statement. There are speculations that the Fed is under pressure to pause rate hikes.
EURUSD has started this week bullish, rallying from 1.127 support level after moving short of 1.14 last week. The 1.127 support level was first formed in late November before price retested it last week. It seems the current bounce might go higher if 1.127 is still holding as a support. Price might somehow continue the sideway triangle pattern that started after the 1.1215 - 1.147 rally in November. If the triangle will hold, the current rally should continue to 1.14. Otherwise,a drop below 1.1270 will eventually happen.
EURUSD Elliott Wave Analysis and Important Price Levels
The dip from 1.147 might continue sideways to complete a triangle wave b (circled). Price needs to add two more legs - wave D and E before it continues upside to 1.155-1.16 to complete a larger bullish corrective pattern following the year-long bearish impulse wave that ended at 1.1215. 1.1270 is now standing as a good support level before 1.1215. A break below these two levels will most likely see the year-long sell-off resume. In as much price stays above 1.1215-1.127 support zone, the bullish run from 1.1215 has a much higher propensity to continue than not.
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