Early in the third February week, the major currency pair remains “in the black” and intends to continue its positive momentum. EUR/USD is mostly trading around 1.2138.
Market players are still focused on the discussions of a new stimulus package to support the American economy. Joe Biden’s office is doing a good job in promoting and approving the plan that will worth at least $1.9 billion.
Some investors believe that the stimulus package will support the strengthening of the “greenback” in the future because it will allow the American economy to recover and recharge. The others are sure that the USD will get weaker due to a higher demand for riskier assets.
American markets are closed today due to the celebration of President’s Day.
In the H4 chart, after reaching the upside target at 1.2140 and then correcting towards 1.2080, EUR/USD has returned to 1.2140; right now, it is consolidating below the latter level. Possibly, today the price may break the range to the upside and expand it up to 1.2207. From the technical point of view, this scenario is confirmed by MACD Oscillator: its signal line is moving outside the histogram area, thus implying a correction. Today, the line is expected to get back inside the histogram area and move upwards.
As we can see in the H1 chart, after finishing the ascending structure at 1.2140, EUR/USD is expected to correct towards 1.2113. Later, the market may form one more ascending structure with the target at 1.2200. From the technical point of view, this scenario is confirmed by Stochastic Oscillator: its signal line is moving above 80, which means that the market is trading within the “overbought area” and may start a new decline towards 50. Later, the line is expected to get back to 80.
By Dmitriy Gurkovskiy, Chief Analyst at RoboForex
Disclaimer
Any forecasts contained herein are based on the author's particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.
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EUR/USD: Looking for Upside
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