EUR/USD Price Remains Under Pressure and Searches for Support
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EUR/USD Price Forecast, Analysis and Chart:
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EUR/USD Continues to Press Lower
The most widely traded currency pair in the world, EUR/USD, continues its long drift lower with little in the way of strong support levels to brake its move. Recently announced Q3 German GDP showed the Eurozone’s largest member miss entering technical recession, but overall growth remains tepid. The German economy grew by 0.1% in the third quarter, beating estimations of a 0.1% contraction, but the Q2 reading was downgraded to -0.2% from -0.1%, meaning the economy contracted by 0.1% over the last six months. On an annual basis the German economy grew by 0.5% from July to September.
The EUR/USD daily chart shows the ongoing weakness in the pair with the pair losing around 160 ticks over the last 10 trading sessions. Earlier in the month we identified the 200-day moving average as tough resistance for the pair to break – which it proved – and any support from the 50- and 20-day moving averages proved fleeting.
EUR/USD Price Technical Outlook – Further Upside Remains Blocked
The pair now look to move further lower with the 1.1000 ‘big figure’ support now longer relevant. EUR/USD is oversold according to the CCI indicator, but this may well just slow down the move and not change its direction. A double low at 1.0940 may stem losses before a re-test of 1.0926 and the October 1 multi-month low at 1.0879. While these targets remain near and achievable, the move may take two or three weeks to play out with the Average True Range of the pair sliding to multi-month lows. Currently around 37 pips, this range is less than half of the range seen at the start of the year and a third of the trading range seen in early 2018.
EUR/USD Daily Price Chart (March - November 14, 2019)
IG Client Sentiment shows that traders are 62% net-long EURUSD, a bearish contrarian bias.
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