The U.S retail sales fell unexpectedly from 0.9% to 0.0% below forecast 0.2% in April. This development put the US dollar under heavy pressure.
In the same time, U.S core retail sales also fell from 0.4% to 0.1% in the previous month, analysts had expected U.S core retail sales to rise towards 0.5% last month.
Anyway, negative US retail sales data pushed the USD lower, let’s take a quick look at EURUSD pair:
EURUSD: The pair is bullish, next leg up should be somewhere between 1.1375/1.1440 levels. immediate resistance comes at the 1.1323 levels, a break would accelerate the expected bullish move. Immediate support comes at the 1.1265 levels, stability above this level on a 4-hour closing basis will keep the bullish momentum intact, below 1.1265 will open 1.1200 levels before the next rise…
Conclusion: we have 3 strong bullish signs which should push the pair towards the 1.1400 levels.
1- The falling trend line has been breached …..
2. The previous top has been breached at the 1.1265 levels, the pair should extend higher before the next fall.(extended bearish divergence)..
3- The pair has formed a hidden bullish divergence pattern (bullish continuation pattern).