EURUSD picked up steam after German headline CPI inflation arrived slightly higher than expected. A downward revision in the US Q2 first estimates and a surprise dip in the private ADP employment report added extra impetus to the price, sending it as high as 1.0944.
In technical indicators, the RSI has pierced through its 50 neutral mark and the MACD has inched above its red signal line for the first time since the end of July, flagging more progress ahead. That said, the indicators will need to sustain strength above their neutral levels to confirm a bullish bias.
In the event the price closes below its shorter-term SMAs and back below 1.0895, it may again seek protection near the 200-day EMA at 1.0800. If that floor cracks this time, selling pressure could intensify to 1.0730, and then down to 1.0634-1.0680.
All in all, a new bullish cycle seems to be developing in EURUSD, but traders might consider it a temporary phase unless the recovery survives above 1.1040.
