Hawkish European Central Bank (ECB) rhetoric and rising German yields have seen EUR/USD recover from 1.0350 lows. In the view of Benjamin Wong Strategist at DBS Bank, there is a bias for an interim consolidation phase until the pair makes sustained gains over 1.0931, the Ichimoku cloud resistance.

Waiting for the fog to lift

“While the recovery from 1.0350 lows drowned out the voices of the EUR parity crowd, EUR has yet to push convincingly through 1.0931 that sites the Ichimoku cloud resistance.” 

“Looking at the monthly charts, there remains no absolute affirmation that EUR’s decline from 1.2349 (January 2021 highs) has ended. EUR gained downside momentum when it sliced through support axing 1.0341-1.0636; as a first step to affirm a true bottom, EUR needs to break above and sustain gains over 1.0931 (Ichimoku cloud resistance).”