The break of the EURUSD bear trend is finally confirmed as the pair pushed strongly through both the 1.00 and 1.01 resistance zones last week. From a technical analysis perspective, at least a larger correction, or potentially a full-scale reversal of the bearish trend, has started.

EURUSD is now testing the 1.0350 resistance zone, which, as we described in Friday’s newsletter, is quite important. This is where the high from August this year sits, converging with a strong Fibonacci zone. The resistance here should be tough, which means if EURUSD breaks higher, 1.05 – which is the next resistance higher – could be reached fairly quickly.

To the downside, the former resistance at the parity zone (1.00) would now be a solid support.