EUR/USD in holding pattern below 1.1100 before Greece proposals

<p>EUR/USD (daily chart shown below) has bumped up against key 1.1100 resistance several times during the current trading week, but has repeatedly retreated, unable to […]</p>

EUR/USD (daily chart shown below) has bumped up against key 1.1100 resistance several times during the current trading week, but has repeatedly retreated, unable to close above this level as of Thursday. With the post-referendum drama in Greece continuing to impart uncertainty on the euro, the EUR/USD currency pair has been trading within a relatively tight range under 1.1100, seemingly with a wait-and-see anticipation.

Currently trading lower on Thursday, EUR/USD remains limited to the upside and well below both its 200-day and 50-day moving averages. From a longer-term perspective, EUR/USD has been entrenched in an unmistakable bearish trend for the past 14 months.

EUR/USD Daily Chart

 

From a shorter-term perspective, the past three weeks have seen a volatile and choppy slide from the major 1.1400 resistance area as Greece’s prospects fluctuated while the US dollar generally continued to strengthen.

With Greek reform proposals and negotiations impending, the euro could see major moves before and into the weekend based upon these developments.

While any positive developments may prompt an upside move for the EUR/USD, the outlook for the currency pair remains bearish overall. The current downside target for any such bearish move resides at the key 1.0800 support level, with a further target at the major 1.0500 support area, which is around the pair’s March multi-year lows. Any sustained break above 1.1100 should be limited to the upside by major resistance around the noted 1.1400 level.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.