EURUSD was breached at the 1.2400 level on the daily and I expect further upside to new highs on the 1.2600 level before further downside

  • Euro launches sharp recovery after finding support near 1.22 vs. US Dollar
  • Near-term down trend established from January high remains intact for now
  • Bearish reversal signal or break and close below the trendline is needed for a trade

The Euro recovered earlier losses after finding support near the 1.22 price level against the US Dollar however the resumption of its uptrend is yet to be confirmed. Indeed, near-term price action continues to be defined by a series of lower highs and lows, warning against assuming that upside continuation is necessarily ahead.

A daily close above falling trend line resistance at 1.2492 opens the door for a challenge of the 1.2538-80 area (January 25 high, 38.2% Fibonacci expansion). Alternatively, a move back below the chart inflection point at 1.2364 paves the way for a retest of the February 9 low at 1.2204.