EUR/USD technical analysis: counter-trend rally may be over already
This month’s rally in EUR/USD from the $1.1704 low touched on 31 March has already run out of steam and the earlier falls in the pair may soon resume.
EUR/USD technical analysis
So far, this month has been good for EUR/USD bulls, with the price climbing steadily from the 31 March low at $1.1704.
However, that looks like simply a rally within a broader trend lower and the rally is already running out of steam, suggesting that the longer-term downward trend may soon resume.
Euro price set to fall back
April has so far been a kind month for EUR/USD bulls, with the price climbing steadily since touching a recent low at $1.1704 on 31 March. However, the last couple of days have seen the pair moving sideways and that suggests the longer-term decline since it hit $1.2243 on 25 February could resume soon.
EUR/USD price chart, daily time frame (7 December 2020 – 8 April 2021)
If there is a decline, the key level to watch out for is that 31 March low and any drop under $1.17 would be a new 2021 low and open the way for further losses, perhaps as far as the $1.1602 low touched on 4 November last year. If this proves wrong, the key level to watch out for on the upside would be the 25 February high mentioned earlier.
Note, incidentally, that from a fundamental perspective the rally can be seen as a bout of profit-taking and short covering by EUR/USD bears that has now finished and that those bears will soon go short of the pair again.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.
