- EUR / USD rose along a week old ascending trendline.
- The setup favors bullish traders and supports the prospect of further gains.
The USD selling bias was unchanged at the start of the European session and pushed EUR / USD to three day highs, around the 1.2225-30 region in the past hour.
From a technical standpoint, the pair built on last week’s rebound from the 1.2125-30 congestion zone and rose along a week-old ascending trendline. The mentioned support is currently anchored near the 1.2185 region which is now expected to serve as a key pivot point for intraday traders.
Meanwhile, technical indicators on the hourly / daily charts have maintained their bullish bias and support the outlook for an extension of the uptrend in the near term. That said, thinned trading conditions over the holidays warrant some caution for the bulls before aggressively positioning themselves for any further near-term appreciation.
Nonetheless, EUR / USD still seems poised to aim again to test again the two and a half year highs, around the 1.2270-75 region, hit earlier in December. Momentum could expand beyond the 1.2300 level and lift the pair further towards intermediate resistance at 1.2340 en route to the 1.2400 mark.
On the other hand, failure to defend the mentioned trendline support near the 1.2185 area could prompt technical selling and pull the EUR / USD back towards the 1.2130-25 area. Some follow-up selling could negate the positive outlook and pave the way for a slide to the 1.2160-55 support area.