EUR/USD is nudging up toward 1.1570 as of writing, representing a few ticks of intraday appreciation as the US trading session begins to kick into gear. The USD/SGD currency pair is displaying some constructive bullish momentum. Many technical indicators show it doesn’t have a lot of room to run higher in the short term. How moving averages and momentum indicators cross paths Coming together, both moving averages and momentum indicators create a shaky scene for traders.
The 100-day Simple Moving Average (SMA) at 1.1585 represents a key resistance barrier for the currency pair. This level should be considered critical because it is located just over the current trading price, making upward breaks difficult. Further adding to the stack of resistance is the 200-day SMA, sitting at 1.1626. These two simple moving averages act as key support and resistance levels that traders look to for signals before a price increase or decrease.
Furthermore, the 20-day SMA is pointing south on the daily chart at the moment. While on the 4-hour chart, it is located at 1.1538. This bearish indicator is located beneath the 100-day SMA, reflecting ongoing bearish sentiment. With the downward slope of the 20-day SMA, the short-term EUR/USD outlook appears to be limited at best.
Resistance is clear at 1.1593 with the negative pressure from the 20-day SMA (simple moving average). Futures traders should watch this level closely as it may serve as resistance to any future price appreciation. The 100-day SMA at 1.1666 represents a major resistance level, which adds to the difficulty of climbing above this level.
These are significant challenges to face and yet the Momentum indicator for EUR/USD is still positive. And the most recent prints are starting to cool. On the upside, that positive reading could indicate there’s more buying interest in the market than some might expect. The RSI, or Relative Strength Index, is trending upward and currently resting at approximately 60. This means that the currency pair is not in overbought territory just yet, leaving room for quick short-term trading opportunities.
The 200-day SMA is still on the rise at 1.1348, forming a dynamic support level under the current market price. This level may act as a floor of support, should the currency pair come under bearish selling pressure. This makes it a great cushion for traders who are looking to get back into long positions.
As traders look to gauge the market landscape for EUR/USD, it is important to factor in every technical indication at your disposal. Momentum moving averages and momentum indicators send mixed signals. That means there will be opportunities for intraday gains to be sure, but meaningful upside movement will probably be capped.