EUR/USD – A Bullish Breakout Is Possible For The Pair
- Take Profit: 1.1025
- Stop Loss : 1.0850
- Timeline: 1-2 days
- Sell Stop : 1.0875
- Take Profit: 1.0800
- Stop Loss : 1.0950
For fundamental analysts, the next key economic data release to watch out for is the building permits and housing starts data from the US. Expert economists have already predicted a significant drop in the figures of housing starts data and on the contrary they are anticipating a rise in the building permits for the month of May. However, these data releases may not have any strong impact on the EUR/USD pair price as the interest rate decisions of Fed and ECB have already set the trend for the pair.
The ECB recently announced a 0.25% rate hike and FED has kept its interest rate policy unchanged which apparently lead to a divergence in the policies of EU and US. John Williams, the head of New York’s central bank is also going to talk about his views on interest rate and this is something we can look forward to as his perspective has always been hawkish from the very beginning. Jerome Powell will also talk about the prevailing inflation and interest rate policies which is another relevant event happening for the pair.
On the technical side, Monday was a holiday for US markets which resulted in low trading volume leading to a drop in price as the pair slid to 1.0920 but it was only a few points below this week’s high at 1.0967. We saw the price dropping below 23.6% retracement level as we witnessed a retreat of the stochastic oscillator. The RSI shifted below the oversold level but the price has maintained its position as it remains slightly above the 25-day MA. The overall outlook is bullish for the pair as of now but a drop below 1.0900 can rule it out.