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EUR/USD Bolts Toward Trendline Resistance, GBP/USD Threatens Bullish Breakout

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EUR/USD AND GBP/USD OUTLOOK:

  • Euro and sterling begin the week on a positive note, bolstered by improving market sentiment
  • U.S. dollar weakens amid lower safe-haven demand
  • This article analyzes key EUR/USD and GBP/USD tech levels to watch in the near term

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The euro and British pound began the week on a bullish note, appreciating moderately against the U.S. dollar on reduced safe-haven demand. Heading into the Wall Street close, EUR/USD was up 0.33% to 1.0795, while GBP/USD was 0.5% higher, trading a touch below the 1.2200 handle.

High-beta currencies were supported by a positive mood following news that First Citizens Bancshares agreed to acquire parts of bankrupt Silicon Valley Bank, a move that may help reduce anxiety over stress in the U.S. banking system.

In addition, leaked reports that U.S. authorities may be considering expanding emergency lending programs to support troubled regional financial institutions in need of liquidity also contributed to the improved sentiment.

With the recent moves, both EUR/USD and GBP/USD are trading near key levels. Below is an analysis of each pair from a technical point of view.




of clients are net long.




of clients are net short.

Change in Longs Shorts OI
Daily 18% 10% 13%
Weekly 15% -9% 1%

EUR/USD TECHNICAL ANALYSIS

After Monday’s advance, EUR/USD is tentatively approaching trendline resistance near the psychological 1.0900 level. Prices were rejected from that region last week, so a similar outcome cannot be ruled out on another test. On the off chance of a pullback, technical support can be seen around the 50-day moving average, followed by 1.0630.

Conversely, if bulls manage to push the pair above the 1.0900 barrier successfully, we could see a move toward the February high around 1.1035. On further strength, the focus shifts to the 1.1200 level.

EUR/USD TECHNICAL CHART

EUR/USD Chart Prepared Using TradingView




of clients are net long.




of clients are net short.

Change in Longs Shorts OI
Daily 2% 16% 9%
Weekly 13% -6% 2%

GBP/USD TECHNICAL ANALYSIS

After the recent rally, GBP/USD is probing cluster resistance located around the 1.2300 area. If this barrier is breached in the coming sessions, bulls could launch an attack on 1.2450, the 61.8% Fibonacci retracement of the 2022 slump, which also aligns with the January and December highs.

On the flip side, if prices get rejected from current levels and begin to correct lower, initial support lies around the 50-day simple moving average. Below that, the next floor of interest can be found at 1.1960, followed by 1.1900.

GBP/USD TECHNICAL CHART

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GBP/USD Chart Prepared Using TradingView

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