The EUR/USD currency pair bounced off 2-week low after the release of the German Ifo Business Climate data, which beat forecast. The pair dropped to hit a new 2-week low of 1.1274 on Friday, but today, it was up again to regain some of the losses incurred at the end of last week. It rallied to trade at above the 1.1320 level in the morning hours before dropping slightly in the afternoon to stabilize just under the 1.1318 level.

EUR/USD Fundamental Analysis

From a fundamental perspective, the EUR/USD currency pair remains upbeat for the day following the positive business confidence data from Germany. The German Ifo business climate index came in at 99.6 for this month, stronger than last February’s 98.5. It also beat the consensus expectation that had estimates in the range of 98.7.

On the other hand, while the US-China trade talks continue to drag, there is a positive atmosphere begin to build around the idea that the US and China could come to a mutual agreement that would result in a more hospitable trade relation. Depending on how traders take these developments, it could work against the greenback as has been the case in the last couple of months.

EUR/USD Technical Analysis (the 240-min Chart)

Technically, the EUR/USD currency pair appears to be trading within a descending channel, which suggests that despite the current rebound, the bears retain control in the intermediate. By using Andrews’ pitchfork, the EUR/USD pair is tightly pegged close to the median line with the +50% and -50% lines acting as resistance and support baselines.

The pair just crossed the median line after the lastest rebound, which makes an interesting trade scenario. The bulls will target the 1.1365 level for profits which will intersect with the +50% line soon. On the other hand, the bears will target the median line for the next rebound at around 1.1288 level.

EUR/USD Technical Analysis (the Daily Chart)

In the daily chart, the EUR/USD currency pair appears to be trading in a more sideways channel, rather than a descending channel depicted in the 240-min chart. This suggests that the long-term movement is likely to be flat with the pair rebounding within the channel.

This provides the bulls with an opportunity to target long-term profits at 1.1448 all the way up to 1.1528 while the bears will be looking down below at around 1.1274 and further down at 1.1171.

In summary, the EUR/USD currency pair looks to be enjoying short-term turbulence that is limited to within a few hundred pips. This sets up the pair for interesting trading scenarios for both the bulls and the bears.