EURUSD has formed lower highs connected by a rising trend line that’s been holding so far this month. Another test of this support zone could be in the works, and the Fibonacci retracement tool shows additional levels where buyers might be waiting.

The 38.2% Fib is close by at 1.0427, then the 50% level is at 1.0400 near the 200 SMA dynamic inflection point. The line in the sand for a bullish correction is the 61.8% Fib that coincides with the trend line support around 1.0376.

The 100 SMA is above the 200 SMA to indicate that the path of least resistance is to the upside or that support is more likely to hold than to break. The gap between the indicators is widening to reflect strengthening bullish momentum, possibly sending EURUSD back to the swing high at 1.0500 or higher.

Stochastic is already on the move up to reflect the presence of bullish pressure, and the oscillator has room to climb before reaching the overbought zone to indicate exhaustion among buyers. RSI also seems to be heading higher, so price could follow suit while buyers have the upper hand.

EURUSD could take cues from the release of the FOMC meeting minutes, as less dovish Fed commentary could mean more upside for the US dollar on dampened expectations of rate cuts for the year.

Recall that the Fed kept rates on hold as expected in January’s decision but that the latest batch of inflation reports have shown weak spots, sparking expectations of a shift back to a more cautious stance.

Risk sentiment could also dictate EUR and USD direction for the remainder of the week, as traders are keeping close tabs on peace talks between Russia and Ukraine. Some signs of progress are being reported, although Trump and Putin would not be meeting next week.