EURUSD declined during the Asian session and attempted to break below a consolidation level at 1.0678. The low price extended to 1.0670 before bouncing higher and returning towards its 100/200 hourly moving averages (blue and green lines in the chart above).
Recalling yesterday, the price rose towards these moving averages, was able to break above its 100 hourly moving average, but remains below the 200 hourly moving average before falling during today’s Asian session. The upside move today may have extended above these moving averages, and now traders are using them as support. The bias has returned to the upside.
That said, the pair is largely within an upside and downside trading range (see the red box in the chart above).
At the top, the 1.0748 – 1.07637 area is home to a number of swing highs dating back to May 24th. Above this zone and the extreme of the cycle up to 1.07861 would be targeted.
Looking at the daily chart, a move above the late May high at 1.07861 would also take the price above the 38.2% retracement of the move down from the 2022 high. 38.2% is the minimum retracement needed to extend above if countertrend traders are to regain more control. Absent that, and the fix is a plain vanilla variety. Holding the 38.2% retracement last month kept the pair in the plain vanilla variety.
Can the price push above this retracement level and work out more bullish soundings?