The EURUSD has entered a period of consolidation this week after Friday’s fakeout above 1.1030.
We saw some initial follow-through from sellers on Monday, but the close above 1.0930 kept the level intact as support.
So, for now, EURUSD is trapped between 1.0930 support and 1.1030 resistance.
Meanwhile, the US Dollar Index (DXY) consolidates above 101.50 support.
I’ve mentioned the similarities between recent price action and the January/February bottom recently.
However, DXY bulls still have work to do.
Bulls need to secure a daily close above the 102.60 monthly open, which would open up the 103.50 yearly open.
That would confirm the first higher high since early March.
Although DXY is still holding above 101.50, we haven’t had a confirmed trend reversal yet, so caution is needed here.
As for EURUSD, last week’s fakeout above 1.1030 looks relatively bearish, but there isn’t much to do while the pair is above 1.0930.
A close below the March 24th trend line and 1.0930 would open up downside targets like the September trend line at 1.0840.
Alternatively, acceptance above 1.1030 would invalidate the bearish scenario.
I’m cautiously bearish EURUSD while below 1.1030, but a sustained break below 1.0930 is needed to expose lower levels.
