FxNews – The European currency hovers around the 50% Fibonacci level at about 1.085 against the U.S. dollar, close to the lower band of the wedge pattern in the 4-hour chart, as depicted in the image above.
The awesome oscillator shows a divergence signal, and the bars are declining toward zero, which is interpreted as there might be a trend reversal or a consolidation phase on the horizon. The RSI indicator still hovers above 50, while the standard deviation indicator value is 0.0016. These numbers indicate that the market is still bullish, but the trend is weak, which aligns with the awesome oscillator’s divergence signal.
EURUSD Technical Analysis: Market Signals and Trends
From a technical standpoint, the pair crossed above the Ichimoku cloud on April 8; therefore, we are in a bull market. However, the pair is still trading below the 61.8% Fibonacci resistance, which is in conjunction with the upper band of the wedge pattern. Due to the AO’s divergence signal, the EURUSD price can dip and test the 38.2% Fibonacci support, followed by the Ichimoku cloud in the 1.081 area. Please be informed that the price must close and stabilize itself below the 1.0847 mark for this scenario to play out.
The Bullish Scenario
Conversely, for the uptrend to continue, the EURUSD price must overcome the 61.8% Fibonacci resistance level, the 1.085 mark. If this scenario comes into play, the next bullish target would be the 78.6% Fibonacci resistance level in the 1.092 area.
