EUR/USD: game of levels
EUR/USD remains range bound between $1.3650 and $1.3600. Euro is still capped by the 200-day MA ($1.3670) and further resistance at $1.3689/90 (June high and 38.2% retracement of the May/June decline). As long as the pair’s trading below these levels, we’ll continue expecting a slide towards $1.3476 (2014 low, trend line support). Support is at $1.3550 (55-week MA). The alternative scenario is an increase above $1.3690 and towards $1.3730.
Traders probably should play the ranges as we don’t expect the pair to move much out of the $1.3700/$1.3500 region in the coming weeks. For instance, Bank of America Merrill Lynch recommends selling in the area of $1.3676/1.3735 targeting $1.3480.
For the short term note that the pair has approached support line at $1.3605.
Chart. H1 EUR/USD