The EUR/USD currency pair soared higher on Monday to hit a new 2-weel high ahead of the US federal reserve guidance on rate hikes for the current year. The currency pair’s upward movement has continued from last week’s bullish run and now seems set to extend to new 2-week highs throughout this week.
EUR/USD Fundamental Analysis
From a fundamental perspective, the bulls currently appear to be more optimistic given the investor expectation regarding the next Federal reserve update on interest rates.
Analysts predict that the Federal Reserve could announce that this year, there will be only two rate hike, that could be further narrowed down to just one, which would signal a dovish outlook thereby adding pressure to the greenback.
On the other hand, with some positivity building around the Brexit, the Euro is expected to gain some strength, and this could push the pair further upwards.
EUR/USD Technical Analysis (the 240-min Chart)
From a technical perspective, the EUR/USD currency pair appears to be trading at a key resistance level, which could suggest a possible pullback at some point this week. At the current level of 1.1346, the pair seems we set for an immediate pullback towards the 1.1300, which could get the bears interested.
On the other hand, as fundamentally discussed briefly above, the bulls seem to have control and they could be aiming 1.1382 for potential profits as the EUR/USD currency pair seeks to make a complete rebound from this month’s plunge which took it to new yearly lows before making the current bullish run.
EUR/USD Technical Analysis (the Daily Chart)
In the daily chart, the EUR/USD currency pair appears to be forming Elliot’s 3 drivers candlestick pattern, which would support the bullish case.
If the current momentum is to be maintained, then this could see the pair rising to retest the 2019 high of about 1.1550. But before that, the bulls will have multiple profit opportunities to target, as will be the bears down below hoping for a pullback.
In summary, the EUR/USD currency pair has rallied to hit a new two week high. Whether this rally continues going forward remains to be seen, but there is a strong bullish case supported both technically and fundamentally.