On Monday morning, the EUR/USD bounced off the support of a weekly pivot point at 1.1015 and began a surge.
By the time this review was being done, the rate was located just below the 55-hour simple moving average at 1.1036. If this resistance level would be broken, the rate could surge to the 1.1060 level without meeting any resistance.
Busy week with minor data
This week, there are couple events that could have an impact on the EUR/USD exchange rate.
On Wednesday, September 11, the US Producer Price Index data will be published at 12:30 GMT. Last release caused only a seven-pip move. However, this data release might cause a more significant market reaction.
On Thursday, September 12, the US Consumer Price Index data will be released at 12:30 GMT. Previous release caused a 23-pip move.
Meanwhile, on September 12, the ECB Monetary Policy Statement will be published at 11:45 GMT. On July 25, the event also caused a 23-pip move.
The week will end with the US Retail Sales release at 12:30 GMT on Friday, September 13. Last release caused almost a fifteen-pip move.
EUR/USD hourly chart's review
During Friday, the EUR/USD currency pair traded sideways at the 1.1040 area. During today's morning, the pair was testing the support formed by the 100– and 200-hour SMAs, as well the weekly PP at 1.1015.If the given support holds, a reversal north could occur in the nearest future, and the exchange rate could re-test the upper boundary of the falling wedge pattern located circa 1.1065. It is unlikely that a breakout north could occur due to the resistance level—the monthly PP at 1.1069.
Otherwise, it is likely that the European Common Currency could depreciate against the US Dollar in the short term. A possible downside target could be the psychological level at 1.0980. Note that the nearest support– the weekly S1, located at 1.0944.
Hourly Chart
On the daily candle chart, a new descending channel pattern has been added. It represents the rate's decline since June.
The pattern managed to break the support of the dominant channel down pattern. In addition, it is expected to provide resistance to the rate during the next couple of weeks.
Daily chart
Read More: Technical Analysis
Traders remain short
Since Friday, 58% of open EUR/USD position volume on the Swiss Foreign Exchange was in short positions.
Meanwhile, pending trade orders were bearish, as 56% of orders in 100 pips range around the current rate were to sell and 44% were to buy.