EURUSD eases from key hurdle but bulls stay hopeful ahead of ECB

EURUSD consolidates recent gains around the five-week top, snapping a six-day uptrend, during a sluggish start to the week. The pair jumped to the highest since late July the previous day but reversed from the 1.1908-10 horizontal resistance. Also challenging the pair buyers was a confluence of 100-day and 200-day SMA around 1.1885-90. Given the RSI conditions, near the overbought area, the latest pullback from the key resistances may extend towards an ascending support line from August 20, near 1.1820. However, any further weakness won’t hesitate to direct the pair sellers towards July lows near 1.1750, before highlighting the August 11 swing trough around 1.1705 and the yearly bottom of 1.1663.

Meanwhile, a daily closing beyond the stated EMA convergence near 1.1890 will have to cross the 1.1910 hurdle to keep pampering the EURUSD bulls. Following that, late June tops near 1.1975 should and the 1.2000 threshold may entertain the pair buyers. In a case where the pair buyers ignore overbought RSI conditions after crossing the 1.2000 round figure, the 61.8% Fibonacci retracement of May-August downside, near 1.2035 will gain the market’s attention. Overall, the ECB’s likely reduction in the weekly bond purchase is the key catalyst for the near-term EURUSD moves.