EUR/USD Signal 24/07: Rallies As Bulls Target 1.200 (Chart)

(MENAFN- Daily Forex) Bullish view

• Buy the EUR/USD pair and set a take-profit at 1.1900.
• Add a stop-loss at 1.1650.
• Timeline: 1-2 days.

Bearish view

• Sell the EUR/USD pair and set a take-profit at 1.1650.
• Add a stop-loss at 1.1900.

The EUR/USD exchange rate for the fifth consecutive day and was nearing the year-to-date high ahead of the European Central Bank (ECB) decision. It also jumped as hopes of a trade deal between the United States and the European Union rose.

The EUR/USD exchange rate fluctuated as investors awaited the ECB's decision. Economists expect the bank to pause its interest rate cuts this time as it observes the impact of the previous cuts on inflation and economic growth.

The meeting comes as the EU and the US are working on a trade deal after months of negotiations. According to Bloomberg, officials were progressing towards a deal that would set a 15% tariff for most imports.

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EU members are willing to accept 15% duties, with steel and aluminum tariffs jumping to as high as 50% once a certain quota is reached. Such a deal will reduce the risk of a prolonged trade war on August 1 when Trump's deadline reaches.

The US has retained substantial tariffs on imported goods in all the deals it has reached in the past few months. For example, it left a 15% tariff on all Japanese goods in a deal announced on Tuesday. It also left similar tariff levels on goods from countries like Indonesia and the UK.

The other key catalyst for the EUR/USD exchange rate will be the upcoming flash manufacturing and services PMI numbers from the United States and the European Union. Economists expect the data to show that Europe's manufacturing PMI rose slightly to 50.8, while the services figure rose slightly to 50.7.

The US manufacturing and services PMI numbers are expected to come in at 52.6 and 53, a sign that the economy is doing well. Also, the US will publish the latest initial jobless claims and new home sales data.

EURUSD Chart by TradingViewEUR/USD Technical Analysis

The daily chart shows that the EUR/USD exchange rate has been in a strong rally this week. This rebound happened after it formed a descending channel, which was part of the bullish flag pattern, a popular continuation sign.

The pair moved close to the year-to-date high as traders waited for the European Central Bank (ECB) decision. It has also remained above the 50-day and 100-day Exponential Moving Averages, a sign that bulls are in control.

Furthermore, the Relative Strength Index (RSI) has been trending upwards, indicating improved momentum. Therefore, the most likely scenario is where the pair continues rising, with the next point to watch being at 1.1900.

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