Today, the euro is strengthening against the US dollar after a decline at the end of last week, which was partly caused by the unexpected outcome of the parliamentary elections in the UK. Tory, contrary to expectations, could not gain an absolute majority in the parliament, the position of Therese May, as acting Prime Minister, weakened, which could affect negotiations on the Brexit process. It should be noted that this election outcome may be an advantage for the Eurozone, because the results have introduced a new uncertainty factor into the economy of Britain, and European leaders would like to start negotiations on Brexit as soon as possible.
This week, a number of economic releases are planned for the Eurozone, and the US Federal Reserve's decision on the interest rate is also expected.
The decline at the end of last week was rather a correction of the upward trend, than a change in the general trend. On the 4-hour chart, the pair broke off from the of 1.1170 and adjusted to the midline of the indicator "Bollinger bands" at around 1.1219. The histogram is in the negative area, keeping a weak signal to sell.
Support levels: 1.1200, 1.1170, 1.1120.
Resistance levels: 1.1240, 1.1265, 1.1280
Long positions can be opened at the level of 1.1230 with the target of 1.1280 and the stop loss at the level of 1.1200.
Short positions should be set at 1.1190 with a target of 1.1120 and a stop loss at 1.1220.
Implementation time: 1-2 days.