EUR/USD Price Analysis: Pares biggest daily jump in six years near 1.1050 ahead of ECB
- EUR/USD consolidates heavy gains, snaps two-day winning streak.
- RSI retreat from overbought zone hints at further weakness.
- 50-SMA, two-week-old previous resistance line restricts immediate declines.
- 100-SMA adds to the upside filters, weekly support line also challenge bears.
EUR/USD renews intraday low around 1.1045 as bulls take a breather during Thursday’s Asian session.
The major currency pair rallied the most since June 2016 the previous day before easing from 1.1095. The pullback moves gain support from the RSI’s retreat from the overbought zone.
However, a convergence of the 50-SMA and the resistance-turned-support from February 23, near 1.1030-25, joined the bullish MACD to challenge the EUR/USD bears.
Even if the quote drops below 1.1030, the weekly support line near 1.0940 will challenge the quote’s further downside before directing the quote towards the latest multi-month low of 1.0806.
It’s worth noting that EUR/USD weakness past 1.0800 will highlight April 2020 bottom surrounding 1.0725.
Alternatively, recovery moves need to cross the recent high of 1.1095 to convince the EUR/USD buyers.
Following that, the 100-SMA level surrounding 1.1170 and 61.8% Fibonacci retracement (Fibo.) of February-March declines, near 1.1230, will challenge the pair’s further upside.
Overall, EUR/USD buyers step back ahead of the key European Central Bank (ECB) meeting but aren’t out of the woods.
Read: ECB Preview: More pain for the euro as doves may strike back amid Ukraine crisis, stagflation risks
EUR/USD: Four-hour chart
Trend: Further weakness expected