EUR/USD extends rally to monthly PP

The 55-day SMA failed to contain bullishness of the common currency yesterday. As a result, EUR/USD is now testing the monthly pivot point at 1.3815, which guards the main resistance area near 1.39. The latter level is considered to be a ceiling for the currency pair, meaning that even if the Euro appreciates in the short term, there are substantial downside risks in the longer term regardless of the signals given by the weekly and monthly technical indicators.

As the single European currency increased in value even more, the bears added another four percentage points and now take up as much as 64% of the market, which is already slightly above the 10-day average of 62%.