First and foremost, the formation of a bottom, commonly referred to as a "double bottom" in technical analysis, has emerged as a strong foundation for the bullish sentiment surrounding EUR/USD. This pattern indicates a potential trend reversal, and traders are closely monitoring this formation as a sign of the end of the recent downtrend.
However, it's worth noting that this bottom has not been thoroughly tested. Beneath the trend line, liquidity has been built, suggesting that the market may revisit these levels before making a significant move. Traders are eagerly awaiting this test, which could serve as a critical confirmation of the bullish trend.Geopolitical events are no strangers to influencing currency markets. Recent global tensions, particularly the situation involving the U.S. and Iran, have injected increased volatility into the market. The missile strikes launched by the U.S. on Iran have raised concerns regarding oil and gold prices, which can have a significant impact on EUR/USD.Specifically, these tensions have the potential to trigger a flight to safe-haven assets like gold, leading to an uptick in gold prices. This, in turn, might indicate increased risk aversion in the market, potentially driving investors towards the euro and strengthening EUR/USD. Moreover, the influence of geopolitical instability on oil prices, with the U.S. being a major player in the industry, can weaken the U.S. dollar, further bolstering the bullish sentiment of EUR/USD.Looking ahead, traders will closely observe the channel where EUR/USD is currently trading. The bullish perspective implies a potential upward push, and this channel will play a pivotal role in assessing the currency's trajectory. A re-evaluation of EUR/USD will be crucial as it approaches this key level.
However, it's worth noting that this bottom has not been thoroughly tested. Beneath the trend line, liquidity has been built, suggesting that the market may revisit these levels before making a significant move. Traders are eagerly awaiting this test, which could serve as a critical confirmation of the bullish trend.Geopolitical events are no strangers to influencing currency markets. Recent global tensions, particularly the situation involving the U.S. and Iran, have injected increased volatility into the market. The missile strikes launched by the U.S. on Iran have raised concerns regarding oil and gold prices, which can have a significant impact on EUR/USD.Specifically, these tensions have the potential to trigger a flight to safe-haven assets like gold, leading to an uptick in gold prices. This, in turn, might indicate increased risk aversion in the market, potentially driving investors towards the euro and strengthening EUR/USD. Moreover, the influence of geopolitical instability on oil prices, with the U.S. being a major player in the industry, can weaken the U.S. dollar, further bolstering the bullish sentiment of EUR/USD.Looking ahead, traders will closely observe the channel where EUR/USD is currently trading. The bullish perspective implies a potential upward push, and this channel will play a pivotal role in assessing the currency's trajectory. A re-evaluation of EUR/USD will be crucial as it approaches this key level.
Comment:
Last weeks analysis was correct, will be posting my outlook for this week soon.
