EUR/USD Uptrend Support Line Respected

Once again, price action on EUR/USD, a daily chart of which is shown, has turned up and respected a key uptrend support line extending from the March lows. This occurs after dollar-strengthening price action for the past week has prompted EUR/USD to correct back down to this uptrend line on the heels of hitting a 14-month high around 1.5060 in the beginning of the week. The current uptrend support line (which has now been respected at least 5 times since its inception) is part of a larger parallel uptrend channel, although for the past 4 months price has been languishing near the lower half of the channel. Today’s tentative trendline bounce hints at a potential uptrend continuation (and continued dollar-weakening), but the key level to watch for confirmation of this continuation would be the noted 1.5060 high. Any breakout above that level should confirm the uptrend and target further significant resistance in the 1.5300 price region. In the event of any subsequent breakdown below the currently-respected uptrend support line, a clear further support target to the downside resides in the key 1.4450 price region.

(Chart courtesy of FX Solutions’ FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

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