EUR/USD continues to keep near key support level for now

There is a light extension to the narrow range today with the pair now clipping 1.0950. That being said, it is still keeping within a ~23 pips range only for the day. There are some large option expiries as well at 1.0930 and 1.0950 that should likely keep price action locked, before we get to US trading.

With that in mind, what is the chart telling us in the bigger picture?

I outlined some key fundamental developments in the pair yesterday here. And things haven’t changed whatsoever on the technical side as well.

EUR/USD continues to be pinned down near the 100-day moving average (red line) and that is the key support level in play currently. The level is seen at 1.0934 at the moment.

Hold above that and buyers are still hanging on to a small chance of a rebound. They would have to reverse sentiment in the near-term chart to convince of anything stronger. In that lieu, the 100-hour moving average is seen at 1.0957 and 200-hour moving average at 1.1000. So, there is some work to be done.

Otherwise, the downside pressure continues to persist with the momentum siding with sellers. But they have some key levels to chew through themselves now as the week winds down.

The 100-day moving average above is one before the 50.0 Fib retracement level of the swing higher since April, seen at 1.0907.

With the dollar having made a comeback in the last two weeks, it turns trading sentiment towards one key question now. Which economy will fare better in the next three to four months; the US or the Eurozone?

The answer to that is likely to fuel the next key directional move in EUR/USD, guided by the technicals.

This article was written by Justin Low at www.forexlive.com.