EURUSD bulls may need to retreat this week to lower levels before the next leg can begin.
Get the details in today’s video, including the DXY level to watch this month.
EURUSD has kicked off March with a remarkable rally, gaining over 500 pips in just seven days.
It’s the most aggressive move from the euro since November 2022, when the pair reclaimed parity after months of weakness.
Last week, I highlighted the 1.0850 – 1.0900 resistance zone, which includes the November 2022 trend line and the mid-range of the 2023-2024 sideways range.
Despite closing above both the trend line and 1.0900 on Tuesday, EURUSD bulls are showing signs of exhaustion.
Yesterday, I told VIP members in Discord to watch for a potential buy-side fakeout (failed breakout) above 1.0865.
Sure enough, euro bulls are retreating today, with EURUSD slipping below 1.0865 on the intraday charts.
A convincing daily close below this level would confirm the fakeout and open the door to lower prices.
One key support to watch is 1.0777, given its significance in 2024.
Below that, the 1.0680 range should also act as support if tested.
As for the DXY, any rally from current levels could run into resistance at 104.60 – 105.00.
That area includes a key horizontal level and the October 2023 trend line, which the DXY broke below last week.
Given how extended these moves have become, a retracement would be normal and healthy at this stage.
