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EURUSD battles with 20-day SMA
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Stochastics head up above oversold zone
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RSI points down near 50 level
EURUSD is moving back and forth between the long-term descending trend line and the 20-day simple moving average (SMA) with strong resistance near the 1.0870 level and significant support at 1.0825 and the 200-day SMA.
According to the technical oscillators, there are some contradicting signals. The stochastic oscillator posted a bullish crossover within its %K and %D lines in the oversold area, indicating the end of the bearish move. However, the RSI is still ticking down, nearing the neutral threshold of 50.
More downside pressures could open the way for a retest of the 50- and 200-day SMAs near 1.0840 before challenging the 1.0800 psychological level. Steeper declines may drive the pair to the ascending trend line at 1.0700.
On the flip side, a successful rise above 1.0870 could give traders optimism for further increases up to 1.0950. A rally higher could retest the 1.0980–1.1000 resistance region that halted bullish moves back in January.
To sum up, in the short-term view, EURUSD can only endorse the bullish tone if there is a close above 1.0950.
