EURUSD Technical Analysis on daily timeframe: 17/07/2023

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Release: 2 years ago

Political and security tensions between China and Japan have once again reached a peak. Recent remarks by Sanae Takaichi regarding Japan’s potential response to a Chinese attack on Taiwan have ignited a new wave of disputes—tensions that neither Donald Trump’s repeated calls with Xi Jinping and Takaichi nor diplomatic outreach have been able to contain. In this article, we take an analytical look at the dimensions of the crisis and its possible consequences.

The EURUSD currency pair has experienced a significant increase in the past 10 days, breaking its recent resistance levels and reaching its 17-month high last Friday. However, it appears that bulls may be unable to extend the recent rally as this pair has approached overbought conditions.

The first support level at 1.1094 will likely be touched in a downtrend formation. Declining below this area could lead to reaching the level of 1.1032. Continuing this trend may bring it to the support level of 1.0834, which is unlikely.

On the other hand, if the recent rally continues uninterrupted, bulls may initially reach the 1.1300 area. Crossing this level, the currency pair can move towards the resistance level of 1.1382 and eventually reach 1.1494.