The euro traded lower against the US dollar on Tuesday morning, edging down to approximately 1.1870 after experiencing three consecutive days of gains. Technical analysis of the daily price chart indicates that the EUR/USD pair remains within an ascending channel pattern, establishing a prevailing bullish sentiment. The nine-day Exponential Moving Average (EMA) is positioned above the 50-day EMA, with both averages trending upwards, reinforcing a short-term upward bias. In the event of price pullbacks, these EMAs are expected to provide dynamic support.
The 14-day Relative Strength Index (RSI) indicates a momentum reading of 68.90, signaling a status just shy of the overbought territory, and confirming sustained bullish momentum following recent upward movements. Immediate resistance for the pair is observed at 1.1918, marking its highest point since June 2021, followed closely by the upper boundary of the ascending channel around 1.1950. Should the pair continue to advance beyond the channel, it could target the psychologically significant level of 1.2000.
Conversely, if the euro faces downward movement, support may be found around the convergence of the nine-day EMA at 1.1770 and the lower boundary of the ascending channel at 1.1750. A decisive break below this channel could exert downward pressure on the EUR/USD, potentially leading to tests of the 50-day EMA at 1.1697, followed by a seven-week low of 1.1589 recorded in early December. A further decline could bring the lower boundary of a descending channel into play around 1.1570.
In broader currency movement, the euro recorded slight declines against major currencies today, with notable weaknesses reflected against the US dollar. The daily performance table reveals that the euro fell by 0.08% against the dollar, while it experienced marginal movements against the British pound, Japanese yen, Canadian dollar, Australian dollar, New Zealand dollar, and Swiss franc. This trend illustrates the euro’s relative strength within the larger context of the currency markets, showcasing shifts both in resistance and support dynamics.
