Euro Consolidates Gains, 1.60 Next?

Having closed above 1.5740, the EURUSD price action has consolidated in a tight 130-pip range. The pair showed a Hanging Man bearish reversal pattern following the close above the previous top, suggesting the up move was exhausted for the time being. The subsequent downside has been limited however, with the pair looking to be consolidating above resistance-turned-support at 1.5730. Having failed to violate the up trend, the EURUSD retains a bullish bias. On balance, US economic data turned from bad to mixed last week, so price action may continue to lack a clear direction until Friday’s Nonfarm Payrolls release. Though we will continue to Buy Euros, the lack of a strong signal means we will keep a close eye on price action and cut losses quickly as we look for a test of the psychologically significant 1.6000 figure.