EUR/USD culd rally if it clears this hurdle

Key highlights

• EUR/USD is eyeing an upside break above the 1.0700 resistance.

• A connecting bearish trend line is forming with resistance near 1.0710 on the 4-hours chart.

EUR/USD technical analysis

Looking at the 4-hours chart, the pair traded as low as 1.0481 and climbed higher. There was a move above the 1.0550 and 1.0600 resistance levels. The bulls were able to push the pair above the 50% Fib retracement level of the downward move from the 1.0713 swing high to 1.0481 low.

The pair is now trading above the 1.0620 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).

On the upside, an initial resistance is near the 1.0700 level. There is also a connecting bearish trend line forming with resistance near 1.0710 on the on the same chart. The next major resistance may perhaps be near 1.0720.

A clear move above the 1.0720 resistance might start a steady increase. In the stated case, EUR/USD might start a steady increase. In the stated case, the pair could rise towards the 1.0800 level.

On the downside, there is a key support at 1.0620 and the 100 simple moving average (red, 4-hours). The main support is now forming near the 1.0550 level. A downside break below the 1.0550 zone might push the pair lower.

The next major support sits near the 1.0500 level. Any more losses might open the doors for a move towards the 1.0450 support zone.