This forex pair is still hovering above the short-term bullish trend line, and it looks like the Eurozone PMIs could trigger a move to the upside.
Analysts expect to see slight improvements in the manufacturing sectors in both Germany and France, so these may be enough to keep hopes narrow for the ECB.
In contrast, the US economy is set to record declines in both manufacturing and services activity for the month of April.
If so, how high can EUR/USD go from here?
EUR/USD 1-hour trading chart by TradingView
The pair formed higher lows in its latest test of the trend line support, which indicates that bullish momentum is building up.
However, the price is stuck in a hold pattern for now, so a break higher might be needed to encourage more buyers to jump in.
I would expect a move above 1.1000 a key psychological mark as confirmation that the bulls are charging in, and this could be enough to take EUR/USD to the swing high of 1.1075 and beyond.
Note that the technical indicators are also hinting at a continuation of the bullish trend.
The 100 SMA is above the 200 SMA to confirm that the support levels are more likely to hold than to be broken. Also, stochastic has some room to climb before it reverses exhaustion among the buyers.
A break below the area of interest and 61.8% Fibonacci retracement will negate this bullish notion, as it may indicate that a reversal is in progress.
This could be the outcome if Eurozone PMIs disappoint and/or US data surprises to the upside, so watch out for those reports.
Take a look at this Event guide for Eurozone PMIs for April!
Don’t forget that EUR/USD is moving Average 83.6 points per dayTherefore, entering a long position above 1.1000 and targeting beyond 1.0750 will be within the range. Also, a stop loss below 1.0930 can give a return on risk of at least 1:1 for this setup.