The EURUSD currency pair, also known as the Fiber, is under selling pressure during the Thursday trading session ahead of the Jobless Claims reports from the US as the optimism around the prolonged debt ceiling talks helped strengthen the US dollar.
The Fiber is on course to close a third consecutive trading session in the red after declining over 0.3% from the turn of the week opening as the US Dollar continue to claw back some of the ground lost against some of its major currency partners. However, the Fiber bulls could be hoping that the Jobless Claims data due from the US could afford them some support, while the bears could be looking to the data for a greenlight to continue rampaging lower.
The 4H chart shows that the Fiber has formed a descending channel following the failure to break above the major resistance level of 1.10955 (thick green line) earlier this month. With the price action staring at the 50% Fibonacci retracement level, the bears will be hoping the current bearish momentum could push the price action below the level to expose the support level at 1.078 (S2) lower, a level of significance for the bears. The fall of the support level would bring the 1.074 support level and the golden ratio into play.
However, should the 50% Fibonacci retracement level hold, the bulls could hope to push the price higher with the pivot point and the upper trendline of the channel acting as significant barriers to the charge. The breakthrough above the upper trendline could trigger a rally towards the significant resistances above.
The Fiber is currently underpinned by the strengthening greenback, sending the currency pair lower, and the bears could be hoping to maintain the momentum post-jobless claims data to immediately target the significant support levels below. However, should the bulls regain dominance in the short term, the bears could look to defend the upper trendline of the channel from the bulls if the bears look to continue the downward pressure.
Sources: TradingView, Reuters, Dow Jones Newswire.
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