EUR/USD trims gains, remain above 1.1850

• EUR/USD off highs on a quiet Monday as the dollar’s recovery losses momentum.
• Short-term recovery could continue, needs a break above 1.1880 to strengthen.

The EUR/USD found resistance at 1.1880 and pulled back to 1.1854 erasing daily gains. It is hovering around 1.1865, flat for the day and holding onto Friday’s gains.

The greenback lost momentum across the board during the last hours, and approached daily lows against most of its rivals. The DXY dropped back toward 92.20. Price action remains limited due to a holiday in the US. Activity will return to normal on Tuesday and the FOMC minutes will be released on Wednesday.

Short-term outlook

The dominant trends appear to continue to favor the downside but in the short-term price has risen above the 20-SMA in 4-hour charts and also it made a strong rebound from the multi-month low near 1.1800. The rebound still looks with some potential.

The next resistance on the upside is the 1.1880 area followed by 1.1920. A slide under 1.1840/50 would remove the positive momentum, exposing the 1.1835 support and the recent low.

Technical levels