The EUR/USD pair rebounded in the short term as the Dollar Index was into a corrective phase. Still, the currency pair could drop anytime again if the DXY starts increasing again. The current bounce back could represent a continuation pattern.
Yesterday, the USD received a hit from the US Unemployment Claims indicator which reported worse than expected data. Today, the German PPI is expected to report a 2.0% growth versus 2.3% in the previous reporting period, while the Euro-zone Current Account could increase from 13.4B to 16.2B.
The Dollar Index is trapped within a down channel. Canada's retail sales data could have a strong impact on the DXY later today, so you have to be careful.
EUR/USD Near Resistance!
EUR/USD has found support on the descending pitchfork's lower median line (LML) and now it challenges the 23.6% retracement level. After ignoring the descending pitchfork's inside sliding line (SL), EUR/USD could approach and reach the median line (ML) which stands as a dynamic resistance.
A bearish pattern, a false breakout around this dynamic obstacle could signal that the rebound is over and that the pair could turn to the downside.
The current rebound was natural after its massive drop. A false breakout through the descending pitchfork's median line (ML) or any other bearish pattern could signal that the EUR/USD pair could drop again.
On the lower timeframes, this could be an up channel, escaping from this pattern could bring new short opportunities. A larger upwards movement could be activated by a valid breakout above the median line (ML).The material has been provided by InstaForex Company - www.instaforex.com