EUR/USD Technical Analysis: focus on the confluence of falling trendline and 50-hour EMA

• The EUR/USD moved above 1.14 in Asia, lifting the relative strength index (RSI) above the falling trendline on the hourly chart.
• As a result, a corrective rally to 1.1434 - confluence of the falling trendline and the bearish 50-hour exponential moving average (EMA) - could be in the offing.
• That said, the outlook as per the daily chart would still remain bearish as the 5-day and 10-day EMAs are trending south. The pair closed below key support of 1.1422 (76.4% Fib R of Sep/Oct rally) yesterday, bolstering the already bearish technical setup. Further, the Rome and Brussels remain at odds over Itlay's national budget.

Hourly chart

Spot Rate: 1.1410

Daily High: 1.1414

Daily Low: 1.1391

Trend: Bullish

Resistance

R1: 1.1422 (former support-turned-resistance)

R2: 1.1440 (5-day EMA)

R3: 1.1473 (10-day EMA)

Support

S1: 1.1379 (previous day's low)

S2; 1.1366 (August 2016 high)

S3: 1.13 (August low)