The EUR/USD aims to retest its 2023 high following a shallow correction

The EUR/USD broke above the 1.1200 level after a 0.75% rally on Friday—the largest daily gain since August 2—reaching a new high for 2024 early Monday.

Bullish momentum remains strong following a two-week advance, putting the pair on track for its biggest monthly gain since November 2022. The weaker dollar, driven by strong Fed rate cut expectations, continues to support the euro.

The next target at 1.1275 (2023 high and 61.8% Fibonacci retracement of the 1.2349/0.9535 downtrend) is now in focus. A decisive break above this level would signal a strong continuation of the uptrend from the September 2022 low of 0.9535, which had paused for a multi-month consolidation.

In the near term, bulls may take a breather as the pair repeatedly faces resistance from a falling and thickening monthly cloud. Overbought daily indicators suggest a limited correction could occur, presenting better buying opportunities.

Key support lies in the 1.1100 area (lows from August 21/22/23), reinforced by a bullish trendline and the rising 10-day moving average, where dips are likely to find strong support.

Res: 1.1201; 1.1221; 1.1239; 1.1275
Sup: 1.1152; 1.1100; 1.1084; 1.1039