On Monday, the pair started the week by surging and testing a cluster of resistance levels.
Economic Calendar Analysis
As the last week of the month, the following week is expected to be a quiet one. However, there are events that should be watched in the case a sharp moves occurs.
On Wednesday, at 12:30 GMT traders should watch the release of the US Durable Goods Orders data. The event is capable of causing volatility increases above average level.
On Thursday, the US Preliminary GDP and the US Unemployment claims are set to be published. Due to these events usually not being released at the same time, the past reactions need to be combined. Namely, in the case of the same direction surprise the volatility pips need to be added one to another. On the other hand, different results shown by each data set could cancel one another out.
Click on the link below to find out more about the data releases.
EUR/USD hourly chart's review
On Friday, the EUR/USD currency pair dropped to the 1.1760 level. During today's morning, the pair was trading upwards.It is likely that the exchange rate could face the resistance formed by the 55–, 100- and 200-hour SMAs, as well the weekly PP in 1.1830/1.1865. Thus, the rate could reverse south and target the support level formed by the weekly S1 and the Fibo 61.80% circa 1.1710.
However, if the given resistance does not hold, it is likely that some upside potential could prevail in the market. In this case the currency pair could target the weekly R1 at 1.1924.
Hourly Chart
On the daily candle chart, the pair remains in a larger channel up pattern, which has guided the pair since the middle of April.
Take into account that a 23.60% Fibonacci retracement level could provide resistance at the 1.2031 level.
Daily chart
Read More: Technical Analysis
Short sentiment increases
On Monday, on the Swiss Foreign Exchange 74% of all EUR/USD open position volume was in short positions.
On Friday morning, the sentiment was 66% short.
Meanwhile, trader set up pending orders in the 100-pip range around the pair were set to sell in 57% of all cases.
Previously, the orders were 52% to sell.