EUR/USD Weekly Technical Forecast: Euro Finds Strong Opposition, Again
- EUR/USD rejected again from 2008 trend-line
- Weakness expected in the near-term following Friday’s price action
- A visit of shorter-term trend-line support may be in store this week
The week before last there was reason coming off the 2008 trend-line to be bearish, last week reason to be bullish on the dip, now we find ourselves back in favor of lower prices in the near-term. The trend-line extending down from 2008 has become problematic for a third time in three weeks.
After inching above the trend-line and recent highs Friday’s forceful rejection has momentum shifted back lower, and as long as the euro stays below on a closing basis the outlook is at best neutral. Turning to near-term support, the trend-line rising up since December (lower parallel of November channel) is a reasonable first target in the days ahead.
If selling were to push the single-currency below this first threshold, the next line of support comes in by way of a slope from May 2016 which recently put a floor in heading into last week. Due to the angle of this slope it is in near confluence with the 2/9 low as well, making the area around 12200 an important one.
To negate a downward bias, we will need to see a strong daily close above the 2008 trend-line and Friday’s high at 12553. This would make for a strong case that the euro will continue higher. But until it is able to do such, resistance will be treated as just that, and the outlook has once again flipped.
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EUR/USD Daily Chart
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---Written by Paul Robinson, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.