EUR/USD traded around the 1.0850 area after a rally, experiencing a pullback due to overbought conditions. The pair is expected to consolidate between 1.0800 and 1.0850 before potentially continuing its uptrend.
The Relative Strength Index (RSI) indicates a sharp pullback but remains near overbought levels, suggesting the correction is part of ongoing consolidation. Meanwhile, the Moving Average Convergence Divergence (MACD) shows flat green bars, indicating stalled bullish momentum.
Key Support And Resistance Levels
Key support lies between 1.0800 and 1.0850, where buyers may re-engage, while resistance sits around 1.0900, which could trigger renewed upward movement. If the pair stays in its current range, further consolidation may follow before another attempt at higher levels.
The recent rally has met some hesitation, with the pair retreating slightly due to stretched conditions in the short term. Momentum indicators reinforce this idea, with the RSI still elevated despite the downturn, which implies that not all buying interest has faded. At the same time, MACD histogram bars have flattened, giving a picture of bulls taking a breather rather than an outright reversal.
With support holding around 1.0800 and resistance forming near 1.0900, trading activity will likely cluster within these limits for now. A dip towards the lower boundary could invite renewed interest from buyers, particularly if short-term signals confirm stabilisation. If this level is defended well, the pair could gather enough momentum for another challenge higher.
Potential Market Scenarios
However, if selling pressure intensifies and breaks below support, sentiment could shift. That would open the door to a more extended retracement, breaking the expected range and putting the recent uptrend into question. On the other hand, a clear move past resistance at 1.0900 would suggest bulls are regaining control, potentially setting up a run toward fresh highs.
Given the mixed signals, maintaining a flexible approach will be essential. Momentum has eased but remains positive overall, meaning short-term corrections should be viewed in context rather than as outright trend reversals. Watching how buyers and sellers react to the established range in the coming sessions should clarify whether the next move is higher or if a deeper pullback is on the table.
