EURUSD Bulls Retain Near-Term Advantage Despite Heavy Resistance Overhead

EURUSD pushed once again above the key resistance area at 1.1560/66 on Monday, encompassing the 100-day moving average and the top of the daily cloud, after Friday’s failed breakout attempt. However, the pair continues to encounter strong selling pressure in this zone.

The euro drew support from weaker-than-expected US nonfarm payrolls data, which further weighed on the dollar by reducing expectations of a Federal Reserve rate hike in September. Despite this boost, bulls have yet to gather enough momentum for a confirmed break higher.

The near-term outlook remains constructive, with bullish daily indicators continuing to support the pair. A period of consolidation between 1.1515 and 1.1560 may pave the way for another attempt to challenge overhead resistance.

Attention now turns to Wednesday’s US CPI report for July, which could provide fresh guidance on the Fed’s policy path. Softer inflation data would likely favor the euro and add pressure on the dollar.

A sustained move above the 100DMA and daily cloud top would strengthen the bullish outlook and expose the next resistance at 1.1586, the 50% Fibonacci retracement of the 1.1849/1.1324 decline. A break there would open the door toward 1.1626, where the 200-day moving average stands.

On the downside, pullbacks should ideally remain above the former 38.2% Fibonacci resistance at 1.1524 to keep the bullish structure intact.

A clear break below the 1.1500 support area, marked by the upper boundary of the previously broken bullish channel and the psychological round-number level, would signal a deeper corrective decline and weaken the near-term positive bias.

Res: 1.1566; 1.1586; 1.1626; 1.1649
Sup: 1.1524; 1.1500; 1.1484; 1.1460