The EUR/USD made a strong upside move right from below the major uptrend line (as shown on the daily chart). On 7/9 the price closed at 1.2780, 20 pips below the key 1.2800 level. It was a relatively weak close, however. We expected a close above 1.2800/30, which would have been more supportive for a bullish bias. Price touched 1.3200 and then turned down and is currently paused above 1.3000. Keep in mind that both 1.3200 and 1.3000 are significant resistance/support levels. Therefore, price may range trade between those two levels before it finally breaks the range.
If price breaks above 1.3200 in a significant manner (“significant” would mean closing at least 50 pips above 1.3200, or closing above 1.3200 for three consecutive trading sessions), the next barrier would be 1.3400/15, the high of 6/17 and also around a major long-term downtrend line extending from 2008 (as shown on the daily chart). To the downside, if price breaks below 1.3000, it may find support at around 1.2940 or the 1-hour EMA 200, and if it breaks below 1.2940, then it may test the major uptrend line again. The daily MACD is about to make a golden cross, and the RSI is rising and approaching 50.
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