EURUSD – Bullish Outlook Above Daily Cloud

EURUSD opened lower on Monday but quickly rebounded as larger bulls regained control, pushing the price towards last Friday’s multi-week high of 1.0842.

The dip was contained by the psychological support at 1.0800, which also aligns with the top of the rising hourly cloud. The subsequent move higher has lifted the price above the top of the daily Ichimoku cloud after a shallow penetration.

The near-term bias is expected to remain bullish as long as the price holds above the daily cloud. A repeated daily close above the broken Fibonacci level at 1.0820 (61.8% of the 1.0915/1.0666 decline) would reinforce the positive near-term outlook.

Last week’s advance of nearly 0.9% also supports the developing bullish signals. Daily studies are bullish, but overbought conditions might obstruct further gains and keep the price in a prolonged consolidation.

However, the fundamentals are not as bright. Recent economic data showed sluggish performance in the bloc’s core industrial sector, particularly in Germany (the EU’s largest economy). This could prompt the ECB to cut rates sooner or more significantly than expected, which would be a negative signal for the euro.

Res: 1.0842; 1.0856; 1.0900; 1.0919
Sup: 1.0820; 1.0800; 1.0777; 1.0756