FX traders could well take EUR/USD higher in the days and weeks ahead, as political developments in France and an improving daily chart points to much bigger euro gains in coming sessions.

The euro held its ground after Monday's sharp swings as investors came to terms with a hung parliament in France, which points to potential political gridlock but lessens fiscal concerns stemming from outright far-right or leftist victories.

EUR/USD remains propped up by the daily cloud that spans the 1.0759-1.0818 region, which could well see a retest of the 1.0857 Fibo: a 76.4% retrace of the 1.0916 to 1.0666 (EBS) drop.
Fourteen-day momentum remains positive, reinforcing the overall bullish market structure.

A EUR/USD break and daily close above the 1.0857 Fibo would likely lead to even bigger gains to test the June 1.0916 peak.
Conversely, a drop and daily close back under the cloud would shift the overall bias back to the downside.

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