Europe’s single currency (EUR) has been on a tear versus the US dollar (USD), up +2.7% month to date. The monthly chart shows buyers and sellers are now squaring off around the 50-month simple moving average (SMA) at US$1.1110, which, alongside neighbouring resistance at US$1.1233, could prove a difficult headwind for bulls to overcome. Another variable to consider here is the trend; the EUR/USD pairing remains in a long-term downtrend, and this, according to price action, will only be invalidated once/if price engulfs the US$1.1276 high formed in July 2023.
Daily and H1 Resistance in View
Meanwhile, price action on the daily timeframe made short work of resistance at US$1.1019, which is now potential support. This cleared the airspace for a run to resistance from US$1.1127, which price is within striking distance of hitting. With the monthly chart showing possible (dynamic) resistance from the 50-month SMA at US$1.1110, daily resistance from US$1.1127 may be a level to watch. A breach of this base might also swing the technical pendulum in favour of further outperformance towards resistance at US$1.1214.
Short-term trading on the H1 chart reveals price recently moved through offers at US$1.11 and shook hands with channel resistance, taken from highs of US$1.1050 (local) and US$1.1047. Note that just north of the aforesaid channel resistances lies another resistance at US$1.1123.
Price Direction?
From the monthly to the daily and H1 timeframes, notable resistance is present on the EUR/USD, between US$1.1127 and US$1.1110. As such, profit-taking at the said resistance area should not surprise, and a downside breakout beyond the local H1 ascending channel could be something short-term sellers watch for.