EURUSD may bounce back as volatility increased near 1.08 area. After a non-volatile and impulsive Bearish momentum, currently, the price may retrace higher. Let’s check EURUSD Technical Analysis for more levels and insights.
February 21, 2020, | AtoZMarkets – EURUSD has been non-volatile with the Bearish momentum, which may correct higher. Despite the recent strong Bearish trend in place, certain upward pressure may create room for the Bulls to regain specific grounds. EURUSD may bounce back to the resistance 1.0920 area on the upcoming days.
In February, Eurozone economic activity was increased significantly faster in comparison to the last six months. As a result, the Euro managed to regain certain grounds against the dominating USD in the process. EURUSD jumped sharply to 1.0820 after both the French and German flash purchasing managers indices for February came out better than expected. The European Central Bank President Luis de Guindos said the bloc’s relatively stable labour market and ultra-low interest rates are supporting current growth.
On the other hand, USD is the dominant currency in the pair which has been sustaining Bearish pressure consistently. Ahead of the U.S. Flash Manufacturing PMI report today, certain volatility is currently observed. Though the market turning a bit volatile for Eurozone growth activity, USD may still remain dominant until a strong Bullish pressure intervenes. Moreover, recent U.S. stock fund loss of $2.6 Billion may also affect the upcoming gains of USD against the Euro.
EURUSD may Bounce Back Toward 1.0920 Area
According to the 1-hour chart, the price is moving sideways after reaching 1.08 key area. The Bulls are trying to take over the market and push the price toward 1.0920 area on the upcoming days.
image: EURUSD 1 Hour Chart
Currently, the price is facing support from the dynamic level of 20 EMA along with the Tenkan line and the Kijun line. Moreover, the Kumo Cloud is also holding the price as support near 1.08 area. The Bulls need to close solidly above 1.08 area to push the price higher. Additionally, The MACD line is rising as the price is consolidating, which results in an emerging Bullish Divergence while trying to push higher. If Bulls manages to close the price above 1.08 area, EURUSD may bounce back toward 1.0920 area.
EURUSD Bears may Face Support at 1.08
According to the daily chart, after a Bearish impulsive pressure toward 1.08 area price is struggling. EURUSD became volatile from last three days after reached 1.08 key level. As per current price action, it may retrace toward 1.0920 area. The dynamic level 20 EMA is far away from the current price. It may pull the price higher as Mean Reversion. Additionally, The Kijun line and the Tenkan line also residing near 1.0920 as a confluence of 20 EMA.
image: EURUSD Daily Chart
Moreover, the MACD lines are near to make a Bullish cross over as the price push higher. If the price manages to close above 1.08 area with a daily close, EURUSD may bounce back upward toward 1.0920 area.
To conclude, EURUSD Bears broke below 1.08 area with a daily close but failed to hold the momentum. Therefore, a specific corrective structure near 1.08 indicates that price may retrace higher toward 1.0920 area on the upcoming days.