On the daily chart below for EURUSD, we can see that as the price tried to break above the previous February high at 1.1033, it was strongly rejected back down. The move lower kicked in as US Retail Sales missed expectations with a further extension of the bearish move as Fed’s Waller delivered hawkish comments and the 1 year inflation expectations in the University of Michigan survey showed a big jump to the upside.

Maybe the market started to worry about the recession after the retail sales numbers and the inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term expectations numbers also helped to lift US Treasury yields giving the USD further momentum.

Anyway, this setup may turn into a major double top with the 1.0533 level as the neckline. The moving averages are still well crossed to the upside, so the bullish trend is intact for now and the buyers will lean on the red long period moving average for further support.

EURUSD technical analysis

On the 4 hour chart below, we can see that the whole move up from the 1.0759 breakout kept diverging with the MACD trading into the February high resistance. This is a signal of a weakening momentum and generally we can see pullbacks or even reversals. All the pullbacks ended when the price touched the trendline, so we can expect the buyers to lean on this trendline with little downside risk to position for longs. The sellers, on the other hand, will want to see the price breaking below the trendline to pile in and push the price to the previous resistance now turned support at 1.0759.

On the 1 hour chart below, we can see that the bearish short-term trend out of the US Retail Sales report is now waning as the price broke above the short-term downward trendline and the moving averages are about to cross to the upside.

There is a little upward trendline giving support for the current pullback and if we see the price break below it, the sellers should push the price to the major trendline somewhere around the 1.09 handle. The buyers, on the other hand, will have more conviction to restart the bullish trend if the price breaks above the short-term resistance at 1.0960.