Euro Consolidates in Tight Range

The EUR/USD is drifting lower, making new intraday lows under 1.0920. The pair Tuesday logged a one-week peak at 1.0984 before losing upside traction. The Fed’s promise for gradual data-dependent tightening suggests that the dollar won’t see runaway gains, and December is still looking likely to the biggest monthly loss the greenback has seen since April. Interest rate differentials have rebounded substantially over the past 3-weeks ever since Draghi failed to deliver to market expectations when cutting the discount rate and easing monetary policy.

The EUR/USD is forming a bull flag pattern which is generally considered a continuation pattern that pauses and refreshes. Prices broke out and have since consolidated over the past few trading sessions. EUR/USD resistance is marked at 1.1050 and 1.1060, which coincide with the 200- and 100-day moving averages, both of which have near horizontal profiles in reflection of the broadly sideways price action. Target support is seen near the Dec-7 low at 1.0796. Momentum on the currency pair remains positive with the MACD (moving average convergence divergence) index printing in the black with an upward sloping trajectory. The RSI (relative strength index) on the other hand reflects consolidation as it is printing a reading of 55, which is in the middle of the neutral range.

The post Euro Consolidates in Tight Range appeared first on FXTM Blog.

Source:: Euro Consolidates in Tight Range