The EURUSD currency pair has failed to break above the top of the rising price channel visible on the 4-hour chart, pulling back from the 1.0894 high. This price action suggests that a consolidation phase is likely underway within the broader uptrend that originated from the 1.0600 low.
Further Pullback Expected
Another leg lower toward the bottom of the rising price channel appears likely over the coming days as the EURUSD digests its recent gains.The first key support level to watch on the downside is the 1.0820 area. A breakdown below this level could potentially trigger a more substantial downside move toward the bottom of the rising channel.
Uptrend Remains Intact Above Channel Support
However, as long as the channel support holds on a closing basis, the overall technical bias will remain tilted to the upside. In this scenario, the upside move from 1.0600 could potentially resume, with further gains still possible toward the 1.1000 handle after the current consolidation period.
Key Resistance Levels
In the near-term, the first level of resistance to watch is at 1.0894. A bullish breakout above this level could potentially signal the resumption of the broader uptrend, with the next key target on the topside in the 1.0950 area.If buyers can push the EURUSD above 1.0950, it would open the door for a potential rally toward the key psychological resistance at 1.1000.
Levels to Monitor
The key levels to monitor in the EURUSD are the rising channel support, the 1.0820 support, the 1.0894 and 1.0950 resistance levels, and the 1.1000 upside target.
As long as the rising channel support holds, the overall technical bias will remain bullish, with the potential for a continuation move toward 1.1000 after the current consolidation.
However, a breakdown below channel support and the 1.0820 level would be a significant technical event, likely opening the door for a deeper pullback within the broader uptrend from 1.0600.
The EURUSD has stalled at channel resistance, leading to a consolidation phase. Traders will want to closely monitor the key support and resistance levels to determine if the uptrend will resume or if a more substantial correction unfolds first.