EUR/USD technical analysis: Remains stuck at key resistance despite trade optimism

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  • EUR/USD is struggling clear resistance at 1.1015 despite trade optimism. 
  • The bias remains bearish with the 4-hour chart reporting range breakdown.

EUR/USD has bounced back above 1.10, but the bias remains bearish, as the range breakdown confirmed on Wednesday is still valid.

The US President Trump delayed the imposition of 5% extra tariffs on $250 billion worth of Chinese goods by two weeks to Oct. 15, sending the risk assets higher. China’s offshore Yuan rose to three-week highs and the US 10-year yield clocked an hour ago on easing trade tensions.

The EUR/USD pair, however, is struggling to draw bids. The pair has gained just 30 pips in the last 12 hours and has remained largely flat around the former support-turned-resistance of 1.1015 in the last three hours.

The failure to find acceptance above 1.1015 amid trade optimism validates the bearish view put forward by Wednesday’s contracting triangle breakdown on the 4-hour chart.

Put simply, the path of least resistance remains to the downside and the doors remain open for a drop to the recent low of 1.0926.

The common currency, however, may rise sharply if the European Central Bank (ECB) delays restarting the quantitative easing program. The market is already priced for a 10 basis point cut in the deposit rate.

As of writing, the pair is trading at 1.1012.

4-hour chart

Trend: Bearish

Technical levels