EUR/USD Reaches New Yearly Highs as Dollar Weakens: Breakout Confirms Bullish Sentiment
13 April 2023
EUR/USD has climbed to new yearly highs during the second half of the European session. The reason for this is the gradual drop in the chances of further rises in the American dollar after yesterday's low CPI reading and a low PPI number reported a few hours ago. Traders are dumping the dollar and shifting their attention to the euro, which is why the most popular pair on the market is currently reaching new long-term highs.
For the past few weeks, EUR/USD has been creating a rising wedge pattern (shown in red), which ended today with the price breaking its upper line. With this breakout, EUR/USD surpassed the highs from February and reached the highest levels since the beginning of April 2022. As long as the price remains above the upper red line, the sentiment remains bullish.
Of course, there is a small chance that the price may come back below the upper red line, which would mean a false bullish breakout and serve as a major signal to sell. The probability of that happening is now low, but once it does happen, you will know what to do