EURO TECHNICAL OUTLOOK: EUR/USD PRICE ACTION BUILDS SUPPORT AROUND 1.1700-HANDLE
- EUR/USD price action remains under pressure after breaching its 50-day moving average
- The Euro is hitting fresh month-to-date lows amid rising market volatility and risk aversion
- EUR/USD now tests a critical technical support level slightly above the 1.1700-price level
EUR/USD is stretching lower this Tuesday with the Euro remaining under pressure against its US Dollar peer. The Euro has declined over 250-pips so far this month and currently trades at its weakest level since mid-August. Volatility has risen steadily over recent trading sessions as markets swoon and looks like the primary catalyst steering EUR/USD price action lower.
EUR/USD PRICE CHART: DAILY TIME FRAME (23 JUN TO 22 SEP 2020)
This has largely contributed to a breach of the 50-day moving average with EUR/USD notching a series of lower highs since topping out at the 1.2000-price level. EUR/USD is now perched slightly above the 1.1700-handle, which stands out as a critical support level highlighted by August swing lows.
| Change in | Longs | Shorts | OI |
| Daily | 13% | -15% | -5% |
| Weekly | -5% | 18% | 8% |
A breakdown below this zone of technical confluence could accelerate EUR/USD selling pressure. Looking ahead, the DailyFX Economic Calendar details upcoming event risk and data releases with potential of weighing materially on market sentiment. The scheduled testimonies from Fed Chair Powell, in addition to global PMI data on deck, stand out in particular.
-- Written by Rich Dvorak, Analyst for DailyFX.com
Connect with @RichDvorakFX on Twitter for real-time market insight
