The current price of EUR/USD suggests a long-term bullish bias, but it is currently experiencing a short-term bearish pullback. Upon analyzing the 4-hour chart, we can observe that prices are currently positioned above both the 50-day and 200-day Moving Averages (MA), indicating a bullish sentiment in the market. The price is approaching a crucial support level at the 61.8% Fibonacci retracement level, which is located at 1.09168.
There are two possible scenarios that could unfold in the market:
Scenario 1: In this scenario, the price may decline further towards the 1.09168 support level. If the bearish momentum persists, the price could potentially test and find support at the 1.08894 level. It is important to monitor the 50% Fibonacci retracement level at 1.08626, as this could be a significant level for the market. If the price successfully tests and bounces off this level, it may head further downwards to test the 200-day MA at the 1.08277 level.
Scenario 2: Alternatively, the price could move higher from the current level to test the upper resistance level at 1.09416. This level holds great significance for the market. If the price manages to test this level and successfully breaks above it, it may continue its upward movement to test the previous week’s high at the 1.0907 level. If a strong bullish momentum is observed at this point, the price has the potential to reach higher and test the 1.10005 level.
In terms of relative strength, the market is currently showing an upward trend, indicating a robust upward momentum.
To summarize, the EUR/USD market is currently experiencing a short-term bearish pullback within a long-term bullish bias. Prices on the 4-hour chart are positioned above the 50-day and 200-day MAs, with the price nearing the support level at the 61.8% Fibonacci retracement level of 1.09168. There are two scenarios to consider: one suggests further downside potential towards 1.08894 and the 50% Fibonacci retracement level at 1.08626, while the other scenario proposes an upward movement towards the resistance levels at 1.09416, 1.0907, and potentially 1.10005. The current relative strength indicates a strong upward momentum.
