Euro Surges To Two-Month High Against Weak Dollar. 

The EURUSD currency pair continued its’ trend higher as the Euro continued to strengthen against the Dollar during the session, reaching its highest level in two months. Investors are betting that the European Central Bank (ECB) will continue to raise interest rates in order to combat inflation, even as the US Federal Reserve signals that it is nearing the end of its tightening cycle. 

The cross was also boosted by data showing that German inflation remained elevated in June, despite a slight decline from May. This suggests that the ECB may need to hike rates more aggressively than previously expected. Meanwhile, the Dollar was weighed down by comments from Fed officials that suggested that the central bank is nearing the end of its tightening cycle. 


The 4H chart shows that the cross has recently successfully broken above a descending triangle trading pattern; however, which was accompanied by declining volume seems to have lost momentum with the bears looking to pounce. 

Zooming in to the 1H chart shows the appearance of the rising wedge trading pattern, where a break below would find support at the 50-SMA (blue line) and the 23.60% Fibonacci retracement level, for a potential pullback to retest the breakout level.  

A sustained break below the 23.60% Fibonacci retracement level would leave the 1.09718 price level to provide a short-term trading opportunity as the bears look to target the 1.09427. However, a break above the wedge would bring in the 1.10341 and 1.10635 resistance levels firmly in play. 


The pair’s uptrend is under threat during the session as the market looks ahead to the crucial inflation data from the US, with the technical analysis revealing a potential pullback with the rising wedge pattern, targeting 1.09427.  

However, a break above the wedge could drive the Euro towards resistance levels at 1.10341 and 1.10635. Traders closely monitor central banks’ chatter and the US inflation data as key drivers for the EURUSD pair during the week. 

Sources: TradingView, Reuters, Trading Economics, Dow Jones Newswire. 

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