From last week: “The USD pullback scenario we saw post-FOMC last week remains in place and EUR/USD price action remain bullish. On the broader time frames we have risen on top of the 20DMA at 1.0882 and this exposes the 50DMA at 1.1197- however this could happen gradually throughout the course of the week. At time of writing the currency pair is pulling back to 1.0920 levels however we are expecting the currency pair to be bid in the region of 1.0870:1.09. If this support materializes we are expecting EURUSD to re-test 18th March highs at 1.1041 and if we see a breach of that level we could potentially see a step higher towards 1.1197”.
EUR/USD pulled back after failing to sustain gains above 1.1040 last week and fell back to 1.0800 on Friday. At the end of the week we saw whip wash moves in the pair as it spiked to 1.0949 at the end of the session, only to close back above 1.0900 and fall again to 1.0820 at the start of the week. We expect the pair to trade predominantly in the range between 1.0800 and 1.1050 ahead of Friday’s NFP data from the US. We expect the pair to gain direction in either way only after Friday’s release where it could rally to 1.1200 to the upside or plunge back toward 1.0500 to the downside.