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EURUSD recovers as Italy Crisis close to an end...

Friday, June 1, 2018 8:57 AM GMT

The Italian political crisis was avoided as the coalition took the approval of the Italian President. The new government is going to be sworn in the next 24 hours. This event is boosting EU stock markets to the upside as well as EURUSD. Additionally, US imposed finally tariffs on steel and aluminum on Thursday. Canada and Mexico already hit back Washington while EU is ready to follow the same strategy. Traders are worried that this is the beginning of a global trade war.

Heading to the technicals, EURUSD is on the way up after bouncing at 1.151 level. The pair is already testing the 32.8% Fibonacci retracement level as seen in the daily chart. The trend remains bearish as the price is still below 21 EMA while a bullish crossing (5 to 21 EMA) is still far away as a scenario.


Reviewing the hourly timeframe, EURUSD is forming a major bottom. In addition, there is a potential head and shoulders pattern as well as a triangle. Bulls like a valid breakout to the upside while bears prefer a rejection of the current zone.


(EMA = Exponential Moving Average, SMA = Simple Moving Average, 5EMA = Blue, 21EMA = White, 200SMA = Yellow)

Always review your own analysis. If there is a confluence between the current study and your own strategy, then you may have even better trading setups.

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