The EURUSD pair has been moving in an uptrend since March 2020 until the end of the year, setting a 30-month high of 1.2350 at the beginning of this year.
- Head&Shoulders on the daily chart
- bullish engulfing
- Tuesday we will know the GDP in the EURO zone
From January to the end of March the price was falling, in April it started an upward trend which lasted until the end of May. Currently, the price returned to the levels of March 2021. On the chart appeared H&S formation, the so-called “head and shoulders”. The neckline of this formation is marked in green on the chart.
On August 6, the price broke through the line and reached the levels from March this year. Last Wednesday there was a strong demand reaction and on the daily chart and a bullish engulfing pattern appeared.
On Friday we witnessed an upward breakout from this formation, accompanied by the forming of an upward divergence on the MACD. If the price breaks through the neckline of this H&S we can expect further increases to the nearest demand zone – 1.1860.
Tomorrow (Tuesday) we will see the Eurozone GDP figures – if they turn out to be better than expected – it may be an additional impulse supporting the technical analysis of the pair. Worse data and a drop below 1.1720 may negate the growth scenario.
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