Euro short-term outlook: EUR/USD support test at prior resistance

Euro technical outlook: EUR/USD short-term trade levels

• Euro March opening-range breakout falters into uptrend resistance post-FOMC
• EUR/USD technically constructive while within monthly uptrend
• Resistance 1.0831/47, 1.0909/22 (key), 1.1032- support 1.0674-1.0704 (key), 1.0574, 1.0524

Euro’s post-FOMC rally faltered at resistance last week with the reversal now searching for support along the March uptrend. These are the updated targets and invalidation levels that matter on the EUR/USD short-term technical charts heading into the close of the month.

Discuss this Euro setup and more in the Weekly Strategy Webinars on Monday’s at 8:30am EST.

Euro Price Chart – EUR/USD Daily

Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView

Technical Outlook: In my last Euro Short-term Technical Outlook we noted that EUR/USD has set the, “monthly opening-range is now set just below resistance at the yearly open / 38.2% Fibonacci retracement of the February decline at 1.0704/24.” A topside breach last week fueled a rally into uptrend resistance before pulling back with Euro down nearly 2% off the highs. Key support now rests at 1.0674-1.0705- a region defined by the 61.8% Fibonacci retracement of the monthly range and the objective yearly open.

Euro Price Chart – EUR/USD 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView

Notes: A closer look at Euro price action shows EUR/USD trading within the confines of a near-term ascending pitchfork formation with the lower parallel further highlighting support at 1.0674-1.0704. Initial resistance now eyed at the March high-day close / 61.8% retracement at 1.0831/47. Ultimately a breach / close above the yearly high-day close / 78.6% retracement at 1.0909/22 would be needed to mark resumption of the monthly uptrend towards 1.1032.

A break / daily close below this formation would threaten a deeper correction towards the March open at 1.0575 and the monthly opening-range lows at 1.0524- both areas of interest for possible downside exhaustion / price inflection IF reached.

Bottom line: Euro reversed off short-term uptrend resistance last week and threatens a test of uptrend support. From a trading standpoint, losses should be limited to the lower parallel IF price is heading higher - look for possible inflection on a stretch towards the median-line around 1.0840. Ultimately, we’re looking for a breakout of the 1.0674-1.0922 range for guidance here. As always, stay nimble into the close of the week / month / quarter. Review my latest Euro weekly technical forecast for a closer look at the longer-term EUR/USD trade levels.

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--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com

Follow Michael on Twitter @MBForex