EUR/USD: the pairs reverses after nearing 1.10

The eurodollar rose sharply on Tuesday, peaking at 1.0101 after initially dropping to 1.0909 in the morning.

There was no economic news to explain this rebound, which could be attributed to a general decline in the USD, and also to the fact that more signs of stabilisation of a virus situation can be seen in Europe than in the US.

However, the approach of the major psychological threshold of 1.10 aroused the interest of sellers, and the pair corrected sharply overnight, struggling to maintain the 1.0949 support in the early Euro session, with a low point at 1.0939.

From a technical standpoint, it should be noted that the EUR/USD's shifts have been on a visible upward slope for the past few days or so, especially in hourly candlesticks. Tuesday's pullback was in fact based on the upper bound of this wedge.

The lower bound of this chart, currently around 1.0929 where the 100-hour moving average is, will be the next important support to be taken into account before the psychological threshold of 1.09 and the 200-hour moving average at 1.0879.

On the upside, Tuesday's highs at 1.0989 and the key threshold of 1.10 form a crucial resistance, which cannot be crossed without a clear catalyst in the news that would support the EUR or weigh down on the USD.

Currently, the EUR/USD pair is trading at 1.0870 on the forex.

Hourly EUR/USD chart