EUR/USD has broken to the upside out of its short-term consolidation that started on 23 August. This favours further short-term strength. But, given the proximity of strong resistances and the overbought readings, we are still expecting a significant correction afterwards.
Given the lack of base formation, the recent strength in EUR is seen as a rebound within an underlying downtrend. We would therefore look at signs of weakness close to the resistance at 1.2748 to initiate a new short EUR position.
Daily Technical Report
